EXHIBIT 10.1
EMPLOYMENT AGREEMENT
This Agreement is made as of December 6, 2000 by and between NTL
Incorporated (the "Company"), and Xxxxxxx Xxxxxx (the "Executive").
1. Duties and Scope of Employment.
(a) Positions; Duties. During the Employment Term (as defined in
Section 2), the Company shall employ Executive as the Company's Senior Vice
President, Chief Operating Officer - UK and Ireland. In such capacity,
Executive shall be located in the UK, and shall serve as the Chief
Operating Officer of the subsidiaries of the Company that are in the
telephone, cable and internet business in the UK and the Republic of
Ireland ("NTL UK"). Executive shall report directly to the Chief Executive
Officer of the Company. Executive shall also perform such duties, which
shall not be inconsistent with the above-described position as are
reasonably assigned to him from time to time by the Chief Executive Officer
of the Company.
(b) Obligations. During the Employment Term, Executive shall
devote substantially all of his business efforts and time to the Company.
Executive agrees, during the Employment Term, not to actively engage in any
other employment, occupation or consulting activity for any direct or
indirect remuneration without the prior approval of the Chief Executive
Officer of the Company; provided, however, that Executive may (i) serve in
any capacity with any professional, community, industry, civic, educational
or charitable organization, (ii) manage his and his family's personal
investments and legal affairs, and (iii) serve on such boards of directors
as are set forth in a list previously furnished to the Chief Executive
Officer of the Company, so long as such activities described in (i), (ii)
and (iii) do not materially interfere with the discharge of Executive's
duties (including, but not limited to, any conflict of interest or
confidentiality matters).
2. Employment Term.
(a) The Company agrees to employ Executive and Executive accepts
employment, in accordance with the terms and conditions set forth in this
Agreement, commencing on and as of the actual commencement date of
Executive's employment hereunder, which shall be November 14, 2000 (the
"Employment Commencement Date") and expiring on November 13, 2002 (such
period being the "Initial Employment Term"), unless earlier terminated as
hereinafter provided.
(b) The Initial Employment Term shall be extended for successive
12 month periods (each an "Extended Employment Term") unless no later than
12 months prior to the end of the Employment Term or an Extended Employment
Term, as the case may be, either the Company or the Executive shall give
notice under this Agreement that the Employment Agreement shall terminate
at the end of the Employment Term or the Extended Employment Term.
(c) As used in this Agreement, the phrase "Employment Term" shall
mean the Initial Employment Term or, if applicable, the Extended Employment
Term, and if the Initial Employment Term or any Extended Employment Term
has been extended for a further 12 month period as provided in paragraph
2(b), shall mean the period ending on the last day of that twelve month
period.
3. There is an obligation on the Company to provide work to the Executive
and the Company shall have no right to put the Executive on garden leave.
4. Compensation/Benefits. During the Employment Term, the Company shall pay
and provide Executive the following:
(a) Cash Compensation. As compensation for his services to the
Company, Executive shall receive a base salary ("Base Salary") and shall be
eligible to receive additional variable compensation. The Executive's
annual Base Salary shall be (pound)300,000, The Executive's annual variable
compensation amount shall be at no less than (pound)150,000 ("Base Annual
Variable Compensation) in addition to which the Executive may receive
further annual variable compensation as the Compensation Committee shall in
its sole discretion determine (on the understanding that such further
annual variable compensation shall be no greater than (pound)150,000).
During the Employment Term, the Compensation Committee of the Board (the
""Compensation Committee") shall with the advice of the Company's Chief
Executive Officer review at least annually Executive's Base Salary and
variable compensation then in effect and shall increase such amounts as the
Compensation Committee may approve. Such Base Salary and, variable
compensation shall be payable in accordance with the Company's normal
payroll practices (which practice includes pro-rata payments of Base Salary
and annual variable compensation for partial years). The annual variable
compensation shall be paid during the month of March following the
Company's financial year end.
(b) Equity Compensation.
(i) Initial Grants. The Compensation Committee of the Board,
which administers the Company's current Stock Option Plan
(the "Plan"), has awarded Executive, as of the Employment
Commencement Date, a non-qualified stock option (the
"Initial Stock Option") under the Company's Plan to purchase
a total of 400,000 shares of Company's common stock (the
"Common Stock"), with a per share exercise price (the
"Exercise Price") equal to 100% of the fair market value of
the Company's Common Stock as of the Employment Commencement
Date (which shall be the issuance date of the Initial Stock
Option). The Initial Stock Option is for a term of 10 years
and shall vest 20% on the date of its issuance and an
additional 20% on each January 1 thereafter, until fully
vested. The other terms and conditions of the Initial Stock
Option are set forth in the standard form of option
agreement that is attached to this Agreement as Exhibit A,
except to the extent that any provision of this Agreement
shall specifically modify such standard form of agreement,
in which case this Agreement shall be controlling.
(ii) Further Grants. On or around the commencement of the second
year of the Initial Employment Term and the commencement of
each Extended Employment Term but in any event prior to 31
December in the relevant year, Executive will be granted an
additional stock option to purchase 50,000 shares of the
Company's Common Stock under the Company's then existing
stock option plan with a per share exercise price equal to
100% of the fair market value of the Company's Common Stock
on the date of grant and on such other terms that are
described in subparagraph (i) of this paragraph 3 including
the provisions for vesting.
(c) Employee Benefits. Executive shall, subject to the rules of
the relevant schemes, be entitled to participate at a level commensurate
with his position in all employee benefit welfare programs provided by the
Company to its senior executives in accordance with the terms as in effect
from time to time.
(d) Business and Entertainment Expenses. Upon submission of
appropriate documentation in accordance with its policies in effect from
time to time, the Company shall pay or reimburse Executive for all business
expenses which Executive incurs in performing his duties under this
Agreement, including, but not limited to, travel, entertainment,
professional dues and subscriptions, and all dues, fees, and expenses
associated with membership in various professional, business, and civic
associations and societies in which Executive participates in accordance
with the Company's policies in effect from time to time.
(e) The Employee shall, subject to the rules of the relevant
schemes, be entitled to receive the Retirement Benefit and Employee
Benefits described on Exhibit A, which Exhibit in the case of duplication
with any other benefit referred to above of similar nature or intent shall
be the benefit afforded to the Executive pursuant to this Agreement.
5. Termination of Employment
(a) Death or Disability. The Company may terminate Executive's
employment for disability in the event Executive has been unable to perform
his material duties under this Agreement for six (6) consecutive months
because of physical or mental incapacity by giving Executive notice of such
termination while such continuing incapacity continues (a "Disability
Termination") provided that no such notice of termination may be served
during a period when the Executive is entitled to payment under a permanent
disability insurance policy unless such policy provides for continuation of
benefit nothwithstanding such termination of employment. Executive's
employment shall automatically terminate on Executive's death. In the event
Executive's employment with the Company terminates during the Employment
Term by reason of Executive's death or a Disability Termination, then upon
the date of such termination (i) the Company shall promptly pay and provide
Executive (or in the event of Executive's death, Executive's estate) (A)
any unpaid Base Salary through the Employment Term and any accrued vacation
through the date of termination, (B) any unpaid variable compensation at
the base targeted level through the Employment Term, with respect to the
fiscal year ending on or preceding the date of termination, (C)
reimbursement for any unreimbursed expenses incurred through the date of
termination ((A), (B) and (C) being "Accrued Benefits") and (D) all other
payments, benefits or fringe benefits to which Executive may be entitled
through the Employment Term.
(b) Termination for Cause. The Company may terminate Executive's
employment for Cause. In the event that Executive's employment with the
Company is terminated during the Employment Term by the Company for Cause,
Executive shall not be entitled to any additional payments or benefits
under this Agreement, other than Accrued Benefits and such rights as shall
appear in the stock option agreements related to those Initial Grants and
Further Grants which shall have vested as at the date of such termination,
subject to the rules of the relevant scheme. For the purposes of this
Agreement, "Cause" shall mean the willful gross misconduct by Executive
with regard to the Company that is materially injurious to the Company. No
act, or failure to act, by Executive shall be "willful" unless committed
without a reasonable belief that the act or omission was in the best
interest of the Company.
(c) Voluntary Termination. Executive may voluntarily terminate his
employment by one week's prior written notice to the Company. In the event
that Executive's employment with the Company is voluntarily terminated
during the Employment Term by Executive, Executive shall not be entitled to
any additional payments or benefits under this Agreement, other than such
rights as shall appear in the stock option agreements related to those
Initial Grants and Further Grants which shall have vested as at the date of
such termination, subject to the rules of the relevant scheme.
(d) By Executive for Good Reason. Executive may terminate his
employment for Good Reason upon written notice to the Company, and in such
event, his employment termination shall be treated as a termination by the
Company under this clause 5. Good Reason shall mean:
(i) A material diminution of Executive's positions or
authority;
(ii) The assignment to Executive of any duties
materially inconsistent with Executive's position;
or
(iii) The failure by the Company to timely make any
payment due hereunder or to comply with any of the
material provisions of this Agreement, provided
that if the Company fails to timely make any such
payment or if the Company fails to comply with any
of the material provisions of this Agreement then
this sub-clause shall have effect only if written
notice of such a breach is served by the Executive
on the Company specifying that it is served under
this sub-clause and the Company shall have failed
to remedy such a breach within 14 days of the
service of such notice.
(e) The Company may, at its sole and absolute discretion,
terminate the Executive's employment forthwith at any time by serving a
notice under this clause stating that this Agreement is being determined in
accordance with this clause 5(e) and undertaking to pay to the Executive by
the next regular scheduled payroll payment date, a payment (subject to tax
and National Insurance) in lieu of the unexpired part of the Employment
Term. Where such termination is other than pursuant to subclause (a), (b)
or (c) of this clause 5, such payment shall be calculated in accordance
with the terms of clause 5(f). For the avoidance of doubt, where the
Company terminates this Agreement in accordance with this clause the terms
of, inter alia, clause 6 and the Confidentiality and Invention Agreement
shall remain in full force and effect.
(f) The payment to which clause 5(e) refers shall be all Base
Salary and Base Annual Variable Compensation (pro-rated for any partial
years) that would have been due under this Agreement had the employee
worked the remainder of the Employment Term. In computing the payment of
Executive's Base Salary and Base Annual Variable Compensation payable to
the Executive pursuant to the preceding sentence, the rate of the
Executive's Base Salary and Base Annual Variable Compensation that is in
existence as of the date of the termination shall be used. In the event of
a termination, Executive shall also be entitled to (i) the immediate
vesting of all Initial Stock Options and Further Grant Options (if any)
notwithstanding any provision to the contrary in the option agreements
relating thereto and (ii) a continuation of his then existing employee
benefits referred to in paragraph 4 (c), (d) and (e) above through the end
of the Employment Term, or such sum as will be necessary to enable the
Executive to acquire like benefits.
6. Non-Compete; Non-Solicit.
(i) In this clause 6 "Group Company" shall mean any undertaking
in or with which the Executive has been involved or
concerned in the 12 months preceding the Termination Date
and which from time to time is:
(a) a subsidiary undertaking of the Company;
(b) a parent undertaking of the Company; or
(c) a subsidiary undertaking of any such parent undertaking;
or any other undertaking:-
(a) in which any of the above holds directly or
indirectly; or
(b) which holds in any of the above directly or
indirectly;
50% or less of the issued share capital or voting rights.
"Subsidiary undertaking" and "parent undertaking" shall
have the meanings attributed to them by the Companies Xxx
0000.
(ii) The parties hereto recognize that Executive's services
are special and unique and that the level of compensation
and the provisions of this Agreement are partly in
consideration of and conditioned upon Executive's not
competing with any Group Company, and that Executive's
covenant not to compete or solicit as set forth in this
clause 6 during and after employment is essential to
protect the business and goodwill of the Group Companies.
(iii) Executive agrees that during the term of employment with
the Company and for a period of 12 months thereafter (the
"Covenant Period"), Executive shall not render services
for any of six specified organizations, such
organizations to be agreed between the parties and
delivered to Executive (the "Prohibited List"). The
Prohibited List may be changed by the Chief Executive
Officer of the Company from time to time (but there may
never be more than six entities listed) on a reasonable
commercial basis by written notice to Executive, such
notice to be effective only if Executive's commencement
of rendering services for such entity is 90 or more days
after the giving of such notice. The Prohibited List
shall not differ from that which applies to other senior
executives of any Group Company who are similarly
situated as to the scope of their employment and
geographical reach. The Prohibited List shall only
contain the names of companies which directly compete
with the Group Companies.
(iv) The Executive shall not, for a period of 12 months after
the termination of the employment of the Executive under
this Agreement ("the Termination Date")), directly or
indirectly, disrupt, damage or interfere with the
operation or business of the Company or any Group Company
by:
(a) soliciting away from the Company or any Group
Company; or
(b) endeavouring to solicit away from the Company or any
Group Company; or
(c) employing or engaging; or
(d) endeavouring to employ or engage,
any Key Personnel. In this clause "Key Personnel" means
any person who is at the Termination Date or was at any
time during the period of twelve months prior to the
Termination Date employed or engaged as a consultant in
any Group Company in an executive or senior managerial
capacity and with whom the Executive has had dealings
other than in a de minimis way during the said period (or
the term of the Executive's employment under this
Agreement if shorter).
(v) During the Covenant Period and thereafter (without
limitation in time), Executive shall not, without prior
written authorization from the Company, violate the
agreement entered into pursuant to clause 9 hereof.
(vi) Executive agrees that the Company would suffer an
irreparable injury if Executive was to breach the
covenants contained in this paragraph 6, and that the
Company would by reason of such breach or threatened
breach be entitled to seek injunctive relief in a court
of appropriate jurisdiction, as well as such other
remedies as may then be appropriate.
(vii) If any of the restrictions contained in this paragraph 6
shall be deemed to be unenforceable by reason of the
extent, duration or geographical scope or other
provisions thereof, then the parties contemplate that the
court shall reduce such extent, duration, geographical
scope or other provision hereof and enforce this
paragraph 6 in its reduced form for all purposes in the
manner contemplated hereby.
(viii) Notwithstanding the foregoing, the provisions of
paragraph 6(iii) shall not apply if there is a wrongful
termination of the Executive's employment or there is
termination by the Executive under clause 5(d).
7. Notices. All notices, requests, demands and other communications called
for under this Agreement shall be in writing and shall be deemed given if
(i) delivered personally or by facsimile, (ii) one day after being sent by
Federal Express or a similar commercial overnight service, or (iii) four
days after being mailed by registered or certified mail, return receipt
requested, prepaid and addressed to the parties or their successors in
interest at the following addresses, or at such other addresses as the
parties may designate by written notice in the manner aforesaid:
If to the Company: NTL Incorporated
000 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: General Counsel
If to Executive: at the last residential address known
by the Company, which is currently
00 Xxxxxxxx Xxxx
Xxxxxx
Xxxxxx XX00 0XX
England
8. Severability. In the event that any provision of this Agreement becomes
or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and
effect without said provision.
9. Proprietary Information. Concurrently with the execution of this
Agreement, Executive shall enter into a confidentiality and proprietary
information agreement with the Company as provided in Exhibit C
("Confidentiality Agreement"), provided, however, that the foregoing shall
not preclude Executive from complying with due legal process or from
removing Company property from the Company's premises in furtherance of his
duties and obligations as provided hereunder.
10. Entire Agreement. This Agreement represents the entire agreement and
understanding between the Company and Executive concerning Executive's
employment relationship with the Company other than for the options being
granted to the Executive, and supersedes and replaces any and all prior
agreements and understandings concerning Executive's employment
relationship with the Company entered into prior to the date hereof but not
any written agreements entered into simultaneous with this Agreement or
thereafter.
11. Governing Law; Jurisdiction.
11.1 Subject to clause 11.2 below
(a) this Agreement shall be governed by the substantive laws of
England and Wales applicable to contracts and agreements made and to
be performed in England and Wales; and
(b) the Executive and the Company expressly consent to the
non-exclusive jurisdiction of the courts located in England and Wales
for any action or proceeding arising from or relating to this
Agreement.
11.2 Notwithstanding clause 11.1 above the terms of the Equity
Compensation referred to in clause 4(b) and Exhibit B shall be
governed by the substantive laws of New York applicable to contracts
and agreements made and to be performed in New York.
12. No Oral Modification, Cancellation or Discharge. This Agreement may
only be amended, canceled or discharged in writing signed by the Executive
and a duly authorized officer of the Company.
IN WITNESS WHEREOF, the undersigned have executed this Agreement.
NTL INCORPORATED
/s/ Xxxxxxx Xxxxx
-------------------------
Xxxxxxx Xxxxx,
Chief Executive Officer
EXECUTIVE
/s/ Xxxxxxx Xxxxxx
-------------------------
Xxxxxxx Xxxxxx
