EXHIBIT 10.24
August 16, 1995
[Name]
[Address]
Dear [Name]:
The Board of Directors (the "Board") of Frontier Corporation, on
behalf of Frontier and its subsidiaries and affiliates (together,
the "Company") has determined that it is in the best interests of
the Company and its shareowners to be able to avail itself of
your continued dedication and service to the Company in the
immediate future and in case of Change of Control, as defined
later in this letter agreement ("Agreement"). It is therefore
the intent of this Agreement to encourage your complete
dedication to the Company by providing you with compensation and
benefits arrangements while you fulfill your duties now and
during the pendency of a Change of Control, should such an event
occur, which provide you with a measure of security commensurate
with your importance to the Company.
Therefore, upon your signature on a counterpart of this
Agreement, the following terms and conditions shall become
effective as of August 16, 1995 and shall supersede any prior
agreements between the Company and you related to the subject
matter hereof. However, this Agreement does not supersede any
stock option agreements, restricted stock grant agreements or
agreements related to the bridging of your prior service with
other employers for pension service credit purposes which may
exist as of August 16, 1995 between the Company and you, all of
which shall remain in full force and effect.
1. Employment.
1.1 Term. The Company shall employ you in a senior
executive management capacity as the Company, with your consent,
may from time to time designate. This Agreement shall become
effective as of August 16, 1995 and shall continue until December
31, 1998, unless earlier terminated or extended in accordance
with its terms. Beginning on January 1, 1998 and on each
anniversary of that date thereafter, the term of this Agreement
(the "Term") shall automatically be extended for one additional
year unless either the Company or you has given written notice to
the other no later than September 30 of the preceding year that
the giver of the notice does not elect to extend the Term. Even
if the Company has given you such a notice, if a Change of
Control has occurred during the Term and you have met your
obligations in the next paragraph of this Section 1.1, the Term
will be automatically extended and this Agreement will remain in
full force and effect until the last day of the 36th month
following the month in which the Change of Control occurs. You
acknowledge that, except as set forth in this Agreement, your
employment is "at will".
If, during the Term, a person (as that term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) commences any action that, if
consummated, would result in a Change of Control of the Company,
or if any person publicly announces an intention or proposal to
commence any such action, you agree that you will not leave the
Company's employ (other than as a result of death, Disability or
Retirement) and will render the services contemplated in this
Agreement for the reasonable duration of the Company's defense
against such action and until such action has been abandoned or
terminated or a Change in Control has occurred.
Any termination of your employment during the Term for
reasons other than your death shall be evidenced by a written
Notice of Termination, which shall specify the provision of this
Agreement relied upon for such termination and describe with
reasonable detail the facts and circumstances claimed by the
sender of such Notice of Termination to provide the basis for
termination. Any such Notice of Termination shall also specify
the effective date of termination (the "Termination Date"). If
you die during the Term the Termination Date shall be the date of
your death.
1.2 Duties. You shall perform all duties incidental to
your position with the Company, or as may be assigned to you by
the Board. You agree to use your best efforts in the business of
the Company and to devote your full time attention and energy to
the business of the Company. You agree not to work, either on a
part-time or independent contracting or consulting basis, with or
without compensation, for any other business or enterprise during
the Term without the Company's prior consent. Such consent shall
not be unreasonably withheld in the case of service on the boards
of directors of other corporations and community organizations.
1.3 Base Compensation. The Company shall pay you as base
compensation an annual salary of $ , in installments in
accordance with the Company's policies from time to time in
effect, until January 1, 1996. Thereafter, your annual salary
may be adjusted by the Company consistent with the Company's
results and your performance during the prior year. However,
unless the annual salaries of all senior executives of the
Company are reduced across-the-board, your annual salary in any
year shall not be less than your annual salary during the prior
year.
1.4 Incentive Compensation. The Company shall establish
and review with you from time to time the performance goals
("Performance Goals") for the Company and you individually, and a
methodology for calculating the amount of incentive compensation
to be paid upon achievement of such Performance Goals. Incentive
compensation shall be payable to you at such time or times as are
established under the Company's policies (including the Company's
Executive Compensation Program) in effect from time to time.
1.5 Benefits; Perquisites. You shall be entitled to
receive the retirement and welfare benefits and perquisites
provided by the Company under its Executive Compensation program
in effect from time to time for executives at the
Chief Executive Officer level.
1.6 Expenses. You shall be reimbursed for any reasonable
expenses you incur in connection with your employment during the
Term, upon presentation to the Company of an itemized account and
receipts of such expenses as required by the Company's policies
from time to time in effect.
2. Developments and Intellectual Property. You acknowledge
that all developments, including but not limited to trade secrets
(including strategies, business plans and customer lists),
discoveries, improvements, ideas and writings which either
directly or indirectly relate to or may be useful in the business
of the Company (the "Developments") which you, either alone or in
conjunction with any other person or persons, shall conceive,
make, develop, acquire or acquire knowledge of during the Term
are the sole and exclusive property of the Company. You will
cooperate with the Company's reasonable requests to obtain or
maintain rights or protections under United States or foreign law
with respect to all Developments. The Company will reimburse you
for all reasonable expenses incurred by you in order to comply
with this provision of this Agreement, regardless of when such
expenses may be incurred.
3. Confidential Information. You acknowledge that by reason
of your employment by the Company, especially as a senior
executive thereof, you will in the future have (and you have had
prior to August 16, 1995), access to information of the Company
that the Company deems to be confidential and/or proprietary,
including but not limited to, information about the Company's
strategies, plans, products and services, methods of operation,
employees, sales, profits, expenses, customer lists and the
relationships between the Company and its customers, suppliers
and others who have business dealings with the Company. You
covenant and agree that during the Term and thereafter, you will
not disclose any such information to any person without the prior
written authorization of the Board.
4. Non-Competition.
4.1 Covenant. In consideration of the benefits provided
to you under this Agreement, which you acknowledge are
independent consideration, you covenant and agree that during the
Restricted Period (as defined below), you will not, directly or
indirectly, without the Company's prior consent: (i) own, manage,
operate, finance, join, control or participate in the ownership
or control of, or be associated as an officer, director,
executive, partner or principal, agent, representative,
consultant or otherwise with, or use or permit your name to be
used in connection with, any enterprise that directly or
indirectly competes (as defined below) with the business of the
Company in a Restricted Area (as defined below); or (ii) offer or
provide employment to, or solicit, interfere with or attempt to
entice away from the Company any individual who either is
employed by the Company at the time of such offer, employment,
solicitation, interference or enticement or has been so employed
by the Company within 12 months prior to such offer, employment,
solicitation, interference or enticement. This Section shall not
be construed to prohibit the ownership by you of not more than 1%
of any class of securities of any corporation which competes with
the Company and which has a class of securities registered
pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
4.2 Definitions.
4.2.1 "Competes" means the production, marketing or
selling of any product or service of any person or entity
other than the Company which resembles or competes with a
product or service produced, marketed or sold by the Company
(or to your knowledge was under development by the Company)
during the period of your employment by the Company (whether
under this Agreement or otherwise).
4.2.2 "Restricted Area" means:
(a) The Standard Metropolitan Statistical Area (or
the equivalent) in which any office, place of
employment, business address or POP maintained by the
Company is located; or
(b) Any state of the United States, any province of
Canada or any foreign country from which the Company or
any of its material subsidiaries or affiliates derives
5% or more of its annual net income.
4.2.3 "Restricted Period" means:
(a) The period of your employment by the Company
(whether under this Agreement or otherwise), if your
employment is terminated because of your death or
Disability;
(b) The period of your employment by the Company
(whether under this Agreement or otherwise) and 24
months thereafter, if your employment is terminated
because of your Retirement, or by the Company for Cause
or without Cause (and not by the Company following
Change of Control);
(c) The period of your employment by the Company
(whether under this Agreement or otherwise) and, if
this Agreement is still in effect at the Termination
Date, the number of months remaining in the Term at the
Termination Date or 12 months, whichever is longer (but
in no event more than 24 months), if you terminate your
employment voluntarily (and not for Good Reason); or
(d) The period of your employment by the Company
under this Agreement, if your employment is terminated
by you for Good Reason or by the Company following
Change of Control.
4.3 Savings Clause. If any of the provisions of this
Section 4 are ever determined by a court to exceed the time,
geographic scope or other limitations permitted by applicable law
in any jurisdiction, then such excessive provisions shall be
deemed reduced, in such jurisdiction only, to the maximum time,
geographic scope or other limitation permitted in such
jurisdiction.
5. Equitable Relief. You acknowledge that the restrictions
contained in Sections 2, 3 and 4 of this Agreement are, in view
of the nature of the business of the Company, reasonable and
necessary to protect the legitimate interests of the Company, and
that any violation of the provisions of those Sections will
result in irreparable injury to the Company. You also
acknowledge that the Company shall be entitled to preliminary and
permanent injunctive relief, without the necessity of proving
actual damages, and to an equitable accounting of all earnings,
profits and other benefits arising from such violation. These
rights shall be cumulative and in addition to any other rights or
remedies to which the Company may be entitled. You agree to
submit to the jurisdiction of any New York State court located in
Monroe County or the United States District Court for the Western
District of New York or of the state court or the federal court
located in or presiding over the county in which the Company has
its corporate headquarters at the applicable time in any action,
suit or proceeding brought by the Company to enforce its rights
under Sections 2, 3 and/or 4 of this Agreement.
6. Company's Obligations upon Termination. The sole
obligations of the Company upon the termination of your
employment prior to the failure of either you or the Company to
extend the Term in accordance with Section 1.1 of this Agreement
are as set forth in this Section 6. Any and all amounts to be
paid to you in connection with your termination shall be paid in
a lump sum promptly after the Termination Date, but not more than
30 days thereafter.
6.1 Termination upon Disability or Death. If your
employment with the Company ends by reason of your death or
Disability (as defined later in this Agreement), the Company
shall pay you all amounts earned or accrued through the
Termination Date but not paid as of the Termination Date,
including:
6.1.1 Base compensation;
6.1.2 Reimbursement for reasonable and necessary expenses
incurred by you on behalf of the Company during the Term;
6.1.3 Pay for earned but unused vacation and floating
holidays;
6.1.4 All compensation you previously deferred (if any) to
the extent not yet paid; and
6.1.5 An amount equal to your "Pro Rata Bonus". Your Pro
Rata Bonus shall be determined by multiplying the "Bonus
Amount" (as defined below) by a fraction, the numerator of
which is the number of days in the fiscal year through the
Termination Date and the denominator of which is 365. The
term "Bonus Amount" means: (i) a bonus calculated using the
performance metrics of the Company's results and your
individual performance for the fiscal year ended prior to
the year in which the Termination Date occurs, applied to
the payouts set forth under the incentive compensation
program in effect for the year in which the Termination Date
occurs; or (ii) if the Termination Date occurs after the end
of a fiscal year but before any bonus related thereto was
paid, the bonus you would have received for that fiscal
year.
The amounts described in Sections 6.1.1 through 6.1.4,
inclusive, are called elsewhere in this Agreement, collectively,
the "Accrued Compensation".
Except as otherwise provided in this Section 6.1, your
entitlement to any other compensation or benefits shall be
determined in accordance with the Company's employee benefit
plans and other applicable programs and practices then in effect.
6.2 Termination Without Cause. If the Company terminates
your employment without Cause (as defined later in this
Agreement), the Company shall pay you:
6.2.1 All Accrued Compensation;
6.2.2 A Pro Rata Bonus (as defined in Section 6.1.5
above); and
6.2.3 Severance ("Severance") equal to: (a) twice the sum
of (i) the annual base compensation you would have received
for the entire fiscal year in which the Termination Date
occurs plus (ii) the Bonus Amount plus (iii) $
(being the agreed cash equivalent of the annual value of the
perquisites provided to you under the Company's Executive
Compensation Program) plus (iv) the Company contributions
which would have been made on your behalf to the 401(k)
retirement savings plan maintained by the Company (b)
reduced by the present value (determined as provided in
Section 280G(d)(4) of the Internal Revenue Code of 1986 as
amended (the "Code")) of any other amount of severance
relating to salary or bonus continuation to be received by
you upon termination of your employment under any severance
plan, policy or arrangement of the Company.
In addition, the Company shall continue to provide to you
and your family at the Company's expense, for 24 months following
the Termination Date, the life insurance, disability, medical,
dental, vision and hospitalization benefits provided to you and
your family immediately prior to the Termination Date.
Lastly, the Company shall credit you with an additional 24
months of service and age for the purposes of determining the
level of your retirement benefits under any qualified or
nonqualified defined benefit pension, supplemental or excess
retirement plan maintained by the Company in which you are a
covered employee (the "Retirement Plans").
Except as otherwise provided in this Section 6.2, your
entitlement to any other compensation or benefits shall be
determined in accordance with the Company's employee benefit
plans and other applicable programs and practices then in effect.
6.3 Termination for Cause or Voluntary Termination. If
your employment is terminated for Cause (as defined later in this
Agreement), or if you voluntarily terminate your employment other
than for Good Reason, the Company shall pay you all Accrued
Compensation. Except as otherwise provided in this Section 6.3,
your entitlement to any other compensation or benefits shall be
determined in accordance with the Company's employee benefit
plans and other applicable programs and practices then in effect.
6.4 Termination for Good Reason or by Company Following
Change of Control. If you terminate your employment for Good
Reason or the Company terminates your employment following a
Change of Control, the Company shall pay you:
6.4.1 All Accrued Compensation;
6.4.2 A Pro Rata Bonus;
6.4.3 Severance equal to: (a) three times the sum of (i)
the annual base compensation you would have received for the
entire fiscal year in which the Termination Date occurs plus
(ii) the Bonus Amount plus (iii) $ (being the agreed
cash equivalent of the annual value of the perquisites
provided to you under the Company's Executive Compensation
Program) plus (iv) the Company contributions which would
have been made on your behalf to the 401(k) retirement
savings plan maintained by the Company (b) reduced by the
present value (determined as provided in Section 280G(d)(4)
of the Code or any other amount of severance relating to
salary or bonus continuation to be received by you upon
termination of your employment under any severance plan,
policy or arrangement of the Company;
6.4.4 An amount equal to your "Supplemental Retirement
Amount". Your Supplemental Retirement Amount shall be equal
to the difference between (a) the benefit payable under the
Retirement Plans which you would have received had your
employment continued for 36 months following the Termination
Date and (b) your actual benefit paid or payable, if any,
under the Retirement Plans. Your Supplemental Retirement
Amount will be determined in accordance with the procedures
set forth in an Addendum to this Agreement, which is made a
part hereof (the "Addendum"); and
6.4.5 An amount equal to your "SERP Payment". Your SERP
Payment shall satisfy the Company's obligations to you under
the supplemental or excess retirement plan or plans
maintained by the Company for its executive employees (the
"SERP") and shall be the actuarial equivalent (using the
Actuarial Assumptions, as defined in the Addendum) of your
benefit accrued under the SERP through the Termination Date.
If all or a part of the SERP Payment is funded through a
trust of which you are a beneficiary, the SERP Payment shall
be paid from such trust to the extent of such funding.
In addition, the Company shall continue to provide to you
and your family at the Company's expense, for 36 months following
the Termination Date, the life insurance, disability, medical,
dental, vision and hospitalization benefits provided to you and
your family immediately prior to the Termination Date.
The Company shall reimburse you for all reasonable legal
fees and expenses which you may incur following a Change of
Control as a result of the Company's attempts to contest the
validity or enforceability of this Agreement or your attempts to
obtain or enforce any right or benefit provided to you under this
Agreement, unless a court determines your actions to be
frivolous.
Except as otherwise provided in this Section 6.4, your
entitlement to any other compensation or benefits shall be
determined in accordance with the Company's employee benefit
plans and other applicable programs and practices then in effect.
7. Gross-Up Payment. Notwithstanding anything else in this
Agreement, if it is found that any or all of the payments made to
you, including but not limited to payments made by the Company,
or under any plan or arrangement maintained by the Company, to
you or for your benefit (other than any additional payments
required under this Section 7) (the "Payments") would be subject
to the excise tax imposed by Section 4999 of the Code or you
incur any interest or penalties with respect to such excise tax
(such excise tax, together with any such interest and penalties,
collectively the "Excise Tax"), then you are entitled to receive
an additional payment (a "Gross-Up Payment") in an amount such
that, after you pay all taxes (including any interest or
penalties imposed with respect to such taxes), including, without
limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the
Gross-Up Payment, you will retain an amount of the Gross-Up
Payment equal to the Excise Tax imposed upon the Payments. The
procedures for the calculation and contesting of any claim that
such Excise Tax is due are set forth in the Addendum.
8. No Obligation to Mitigate Damages. You are not require to
mitigate damages or the amount of any payment provided for under
this Agreement by seeking other employment or otherwise, and the
amounts to be paid to you under Section 6 of this Agreement shall
not be reduced by any compensation you may earn from other
sources. However, if, during any period that you would otherwise
be entitled to receive any payments or benefits under this
Agreement, you breach your obligations under Section 2, 3 or 4 of
this Agreement, the Company may immediately terminate any and all
payments and the provision of benefits (to the extent permitted
by law and the terms of the benefit plans maintained by the
Company from time to time) hereunder.
9. Successor to Company. The Company will require any
successor or assignee to all or substantially all of the business
and/or assets of the Company, whether by merger, sale of assets
or otherwise, by agreement in form and substance reasonably
satisfactory to you, to assume and agree to perform the Company's
obligations under this Agreement in the same manner and to the
same extent that the Company would be required to perform them if
such succession or assignment had not taken place. Such
agreement of assumption must be express, absolute and
unconditional. If the Company fails to obtain such an agreement
within three business days prior to the effective date of such
succession or assignment, you shall be entitled to terminate your
employment under this Agreement for Good Reason.
10. Survival. Notwithstanding the expiration or termination of
this Agreement, except as otherwise specifically provided
herein, your obligations under Sections 2, 3 and 4 of this
Agreement and the obligations of the Company under this Agreement
shall survive and remain in full force and effect.
This Agreement shall inure to the benefit of, and be
enforceable by, your personal and legal representatives,
executors, administrators, successors, heirs, distributees,
devisees and legatees. If you die while any amounts are still
payable to you, all such amounts, unless otherwise provided in
this Agreement, shall be paid in accordance with the terms of
this Agreement to your devisee(s), legatee(s) or other
designee(s) or, if there is no such designee(s), to your estate.
11. Definitions. Whenever used in this Agreement, the
following terms shall have the meanings below:
11.1 "Cause" means:
11.1.1 You have willfully and continually failed to
substantially perform your duties (other than due to an
incapacity resulting from physical or mental illness or due
to any actual or anticipated failure after you have given a
Notice of Termination for Good Reason) after a written
demand for substantial performance is delivered to you by
the Board which specifically identifies the manner in which
it is believed that you have not substantially performed
your duties; or
11.1.2 You have willfully engaged in conduct which is
demonstrably and materially injurious to the Company
(monetarily or otherwise); or
11.1.3 You have willfully engaged in conduct which is
illegal or in violation of the Company's Code of Ethics; or
11.1.4 You have been convicted of a felony; or
11.1.5 You have violated the provisions of Section 2
and/or Section 3 and/or Section 4 of this Agreement
and, in any of the events described in Sections 11.1.1 through
11.1.5 above, the Board adopts a resolution finding that in the
good faith opinion of the Board you were culpable for the conduct
set forth in any of Sections 11.1.1 through 11.1.5 and specifying
the particulars thereof in detail. For the purposes of this
Agreement, no act or failure to act on your part shall be
considered willful unless done, or omitted to be done, by you not
in good faith and without reasonable belief that your action or
omission was in the best interests of the Company. Any such
resolution of the Board must receive the affirmative vote of not
less than three-quarters of the entire membership of the Board at
a meeting of the Board called and held for the purpose of
considering the issue, and you must receive reasonable notice of
the meeting and have an opportunity, with your counsel, to
present your case to the Board.
11.2 "Change of Control" means:
11.2.1 The consummation of a consolidation or merger of
the Company in which the Company is not the continuing or
surviving corporation or pursuant to which the shares of the
Company's common, voting equity are to be converted into
cash, securities or other property. For the purposes of
this Agreement, a consolidation or merger with a corporation
which was a wholly-owned direct or indirect subsidiary of
the Company immediately before the consolidation or merger
is not a Change of Control; or
11.2.2 The sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or
substantially all of the Company's assets; or
11.2.3 The approval by the Company's shareowners of any
plan or proposal for the liquidation or dissolution of the
Company; or
11.2.4 Any person, as that term is used in Section 13(d)
and 14(d) of the Exchange Act (other than the Company, any
trustee or other fiduciary holding securities of the Company
under an employee benefit plan of the Company, a direct or
indirect wholly-owned subsidiary of the Company or any other
company owned, directly or indirectly, by the shareowners of
the Company in substantially the same proportions as their
ownership of the Company's common, voting equity), is or
becomes the beneficial owner (within the meaning of Rule
13d-3 under the Exchange Act), directly or indirectly, of
30% or more of the Company's then outstanding common, voting
equity; or
11.2.5 During any period of two consecutive years,
individuals who at the beginning of such period constitute
the Board, including for this purpose any new director
(other than a director designated by a person who has
entered into an agreement with the Company to effect a
transaction described in this Section 11.2.5) whose election
or nomination for election by the Company's shareowners was
approved by a vote of at least two-thirds of the directors
then still in office who were directors at the beginning of
the period or whose election or nomination for election was
previously so approved (the "Incumbent Board"), cease for
any reason to constitute a majority of the Board.
11.3 "Disability" means:
11.3.1 Your absence from your duties with the Company on a
full-time basis for 180 consecutive business days as a
result of incapacity due to mental or physical illness; or
11.3.2 A physical or mental condition which prevents you
from satisfactorily performing your duties with the Company
and such incapacity or condition is determined to be total
and permanent by a physician selected by the Company or its
insurers and reasonably acceptable to you and/or your legal
representative.
11.4 "Good Reason" means:
11.4.1 Without your express written consent, after a
Change of Control, the assignment to you of duties with the
Company or with a person, as that term is used in Section
13(d) and 14(d) of the Exchange Act, in control of the
Company materially diminished from the duties assigned to
you immediately prior to a Change of Control; or
11.4.2 Without your express written consent, after a
Change of Control, any reduction by the Company or any
person, as that term is used in Section 13(d) and 14(d) of
the Exchange Act, in control of the Company in your annual
base compensation or annual bonus at Standard (or
equivalent) rating from the amounts of such compensation
and/or bonus in effect immediately before and during the
fiscal year in which the Change of Control occurred (except
that this Section 11.4.2 shall not apply to across-the-board
salary or bonus reductions similarly affecting all
executives of the Company and all executives of any person
in control of the Company); or
11.4.3 Without your express written consent, after a
Change of Control, the failure by the Company or any person,
as that term is used in Section 13(d) and 14(d) of the
Exchange Act, in control of the Company to increase your
annual base compensation or annual bonus at Standard (or
equivalent) rating at the times and in comparable amounts as
they are increased for similarly situated senior executive
officers of the Company and of any person, as that term is
used in Section 13(d) and 14(d) of the Exchange Act, in
control of the Company; or
11.4.4 Without your express written consent, after a
Change of Control, the failure by the Company or by any
person, as that term is used in Section 13(d) and 14(d) of
the Exchange Act, in control of the Company to continue in
effect any benefit or incentive plan or arrangement (except
any benefit plan or arrangement which expires by its own
terms then in effect upon the occurrence of a Change of
Control) in which you are participating at the time of the
Change of Control, unless a replacement plan or arrangement
with at least substantially similar terms is provided to
you; or
11.4.5 Without your express written consent, after a
Change of Control, the taking of any action by the Company
or by any person, as that term is used in Section 13(d) and
14(d) of the Exchange Act, in control of the Company which
would adversely affect your participation in or materially
reduce your benefits under any benefit plan or arrangement
or deprive you of any other material benefit (including any
miscellaneous benefit which is not represented and protected
by a written plan document or trust) enjoyed by you at the
time of a Change of Control; or
11.4.6 You terminate your employment (other than because
of your death, Disability or Retirement) by giving the
Company a Notice of Termination with a Termination Date not
later than the first anniversary of the Change of Control;
or
11.4.7 Any failure by the Company to comply with any of
its material obligations under this Agreement, after you
have given notice of such failure to the Company and the
Company has not cured such failure promptly after its
receipt of such notice.
11.5 "Retirement" means a voluntary or involuntary
termination of your employment after age 65 or any voluntary
termination at age 65 or earlier that entitles you to receive a
normal or early retirement service pension under the Retirement
Plans (or any successor or substitute plan or plans the Company
puts into effect prior to a Change in Control).
12. Notice. All notices and other communications required or
permitted under this Agreement shall be in writing and shall be
deemed given when mailed by certified mail, return receipt
requested, or by nationally recognized overnight courier, receipt
requested, when addressed to you at your official business
address when employed by the Company or at your home address as
reflected in the Company's records from time to time and when
addressed to the Company at its corporate headquarters, to the
attention of the Board, with a required copy to the Company's
Corporate Counsel.
13. Amendment and Assignment. This Agreement cannot be
changed, modified or terminated except in a writing. You may not
assign your duties with the Company to any other person.
14. Severability. If any provision of this Agreement or the
application of this Agreement to anyone or under any
circumstances is determined by a court to be invalid or
unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect any other provisions or
applications of this Agreement which can be effective without the
invalid or unenforceable provision or application, and such
invalidity or unenforceability shall not invalidate or render
unenforceable such provision in any other jurisdiction.
15. Remedies Cumulative; No Waiver. No remedy conferred on you
or on the Company by this Agreement is intended to be exclusive
of any other remedy, and each and every remedy shall be
cumulative and shall be in addition to any other remedy given
under this Agreement or now or later existing at law or in
equity. No delay or omission by you or by the Company in
exercising any right, remedy or power under this Agreement or
existing at law or inequity shall be construed as a waiver of
such right, remedy or power, and any such right, remedy or power
may be exercised by you or the Company from time to time and as
often as is expedient or necessary.
16. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York,
without regard to any applicable conflicts of laws.
17. Counterparts. This Agreement may be signed by you and on
behalf of the Company in one or more counterparts, each of which
shall be one original but all of which together will constitute
one and the same instrument.
If this Agreement correctly sets forth our agreement on its
subject matter, please sign and return to me the enclosed copy of
this Agreement. Please keep the other copy for your records.
Sincerely,
FRONTIER CORPORATION
By:
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Agreed to on
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[Name]
ADDENDUM TO LETTER AGREEMENT DATED AUGUST 16, 1995
The following provisions shall apply to the determination of
the Supplemental Retirement Amount in accordance with Section
6.4.4 of the Agreement.
1. The Supplemental Retirement Amount shall be determined
using the actuarial equivalent of the benefit payable under the
Retirement Plans which you would have received had your
employment continued for 36 months following the Termination Date
and, using the Actuarial Assumptions (as defined below) of your
actual benefit paid or payable, if any, under the Retirement
Plans. The actuarial equivalent shall be determined by using the
actuarial assumptions applied by the Company during the 90 day
period immediately prior to a Change of Control in connection
with the Retirement Plans (the "Actuarial Assumptions").
2. The calculation of your Supplemental Retirement Amount
shall also be based on the assumptions that your annual base and
incentive compensation would have remained the same over those 36
months, all accrued benefits under the Retirement Plans are fully
vested and the benefit accrual formulas are those provided for in
the Retirement Plans during the 90 day period immediately prior
to a Change of Control.
3. If all or a part of your Supplemental Retirement Amount
is derived under a supplemental or excess retirement plan
maintained by the Company for its executive employees (a "SERP"),
then the amount of your Supplemental Retirement Amount which is
derived from the SERP shall be paid from any trust of which you
are a beneficiary to the extent of funding actuarially available
in that trust to pay your Supplemental Retirement Amount.
The following provisions shall apply to the calculation and
procedures relating to the Gross-Up Payment in accordance with
Section 7 of the Agreement.
1. The Company's independent auditors in the fiscal year
in which the Change of Control occurs (the "Accounting Firm")
shall determine whether and when a Gross-Up Payment is required,
the amount of such Gross-Up Payment and the assumptions to be
used in making such determination. The Accounting Firm shall
provide detailed supporting calculations, together with a written
opinion with respect to the accuracy of such calculations, to you
and the Company within 15 business days of the receipt of a
written request from either you or the Company. If the
Accounting Firm is serving (or has served within the three years
preceding the Change in Control) as accountant or auditor for the
person in control of the Company following the Change of Control
or any affiliate thereof, you may appoint another nationally
recognized accounting firm to make the determinations required in
connection with the Gross-Up Payment and the substitute
accounting firm shall then be referred to as the Accounting
Firm). The Company shall pay you any Gross-Up Payment,
determined in accordance with this Addendum, within five days of
the receipt of the Accounting Firm's determination. If the
Accounting Firm determines that you will not be liable for any
Excise Tax, it shall furnish you with a written opinion that your
failure to report the Excise Tax on the applicable federal income
tax return would not result in the imposition of a negligence or
similar penalty. Any determination by the Accounting Firm shall
be binding upon you and the Company.
2. If there is uncertainty about how Section 4999 is to be
applied when the Accounting Firm makes its initial determination,
and as a result the Gross-Up Payment made to you by the Company
is determined (after following the procedures set forth in this
Addendum) to be less than it should have been made (an
"Underpayment"), and you are thereafter required to pay any
Excise Tax, the Accounting Firm shall determine the amount of the
Underpayment and any such Underpayment shall be promptly paid by
the Company to you or for your benefit.
3. You shall notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require
the Company to pay you the Gross-Up Payment. Your notice shall
be given as soon as practicable but no later than ten business
days after you have been informed in writing of such claim and
shall apprise the Company of the nature of such claim and the
date on which such claim is requested to be paid. You shall not
pay such claim prior to the expiration of the 30 day period
following the date on which you gave such notice to the Company
(or any shorter period, if the taxes claimed are due sooner). If
the Company notifies you in writing prior to the expiration of
such period that it desires to contest such claim, you shall:
(a) give the Company any information reasonably requested by it
relating to such claim, (b) take such action in connection with
contesting such claim as the Company shall reasonably request in
writing from time to time, including, without limitation,
accepting legal representation with respect to such claim by an
attorney reasonably selected by the Company, (c) xxxxxxxxx with
the Company in good faith in order effectively to contest such
claim, and (d) permit the Company to participate in any
proceedings relating to such claim.
4. The Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue
or forgo any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in connection
with the claim and may, at its sole option, either direct you to
pay the tax claimed and sue for a refund or contest the claim in
any permissible manner, and you agree to prosecute the contest to
a determination before any administrative tribunal, in a court of
initial jurisdiction and in one or more appellate courts as the
Company shall determine.
5. Any extension by the Company of the statute of
limitations relating to payment of taxes for the taxable year for
which such contested amount is claimed to be due shall be limited
solely to such contested amount. The Company's control of the
contest shall be limited to issues with respect to which a
Gross-Up Payment would be payable under this Agreement and you
shall be entitled to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service or any other
taxing authority.
6. If the Company directs you to pay such claim and sue
for a refund, the Company shall advance the amount of such
payment to you, on an interest-free basis, and shall indemnify
and hold you harmless, on an after-tax basis, from any Excise Tax
or income tax (including interest or penalties with respect
thereto) imposed with respect to such advance or with respect to
any imputed income with respect to such advance.
7. If you receive a refund of any amount advanced to you
by the Company, you will promptly pay to the Company the amount
of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If the Company advanced
to you any amounts and a determination is made that you will not
be entitled to any refund with respect to such claim and the
Company does not notify you in writing of its intent to contest
such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and you
will not be required to be repay it. The amount of such advance
shall offset the amount of the Gross-Up Payment required to be
paid.
8. The Company shall pay all fees and expenses of the
Accounting Firm. The Company shall bear and pay directly all
costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and
hold you harmless, on an after-tax basis, for any Excise Tax or
income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment
of costs and expenses.
