SENIOR MANAGEMENT AGREEMENT
EXHIBIT 10.36
THIS
SENIOR MANAGEMENT AGREEMENT (this “Agreement”) is made as of June 3, 2002, by and among TSI Telecommunication Holdings, LLC, a Delaware limited liability company (the “Company”), TSI Telecommunication Services,
Inc., a Delaware corporation (“Employer”), and Xxxxxxx Xxxxxxx (“Executive”).
The Company and Executive desire to enter into an agreement pursuant to which Executive will purchase from the Company, and the Company will sell 270,270.27 of the Company’s Common Units (the “Common
Units”). The Common Units acquired by Executive pursuant to Section 1(a) of this Agreement are referred to herein as “Carried Units”. Certain definitions are set forth in Section 9 of this Agreement.
Certain provisions of this Agreement are intended for the benefit of, and will be enforceable by GTCR Fund VII,
L.P., a Delaware limited partnership (“GTCR Fund VII”), GTCR Fund VII/A, L.P., a Delaware limited partnership (“GTCR Fund VII/A”), GTCR Co-Invest, L.P., a Delaware limited partnership (“GTCR
Co-Invest”, together with GTCR Fund VII, GTCR Fund VII/A and any other investment fund managed by GTCR Xxxxxx Xxxxxx, L.L.C., each an “Investor” and collectively, the “Investors”).
Employer desires to employ Executive on the terms and conditions set forth herein, and Executive is willing to accept such employment on
such terms and conditions.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:
PROVISIONS RELATING TO CARRIED UNITS
1. Purchase and Sale of Carried Units.
(a) Upon
execution of this Agreement, Executive will purchase, and the Company will sell, 270,270.27 Common Units at a price of $0.0333 per unit. The Company will deliver to Executive copies of the certificates representing such Common Units, and Executive
will deliver to the Company a cashier’s or certified check or wire transfer of immediately available funds in an aggregate amount of $9,000.00 as payment for such Common Units.
(b) Within 30 days after the purchase of the Carried Units hereunder, Executive will make an effective election with the Internal Revenue Service under Section
83(b) of the Internal Revenue Code and the regulations promulgated thereunder in the form of Exhibit A attached hereto.
(c) Until the occurrence of a Sale of the Company, any certificates evidencing Carried Units shall be held by the Company for the benefit of Executive and the other holder(s) of Carried Units. Upon the occurrence of a Sale
of the Company, the Company will return any such certificates for the Carried Units to the record holders thereof. Upon the occurrence of a Public Offering, the Company will return to the record holders thereof any certificates
representing Vested Units.
(d) In connection with the purchase and sale of the Carried Units, Executive represents and warrants to the Company that:
(i) The Carried Units to be acquired by Executive pursuant to this Agreement will be acquired for
Executive’s own account and not with a view to, or intention of, distribution thereof in violation of the Securities Act, or any applicable state securities laws, and the Carried Units will not be disposed of in contravention of the Securities
Act or any applicable state securities laws.
(ii) Executive is an executive officer of
the Employer or a Subsidiary, is sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Carried Units.
(iii) Executive is able to bear the economic risk of his investment in the Carried Units for an indefinite period of time because the Carried
Units have not been registered under the Securities Act and, therefore, cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available.
(iv) Executive has had an opportunity to ask questions and receive answers concerning the terms and conditions of the offering of Carried
Units and has had full access to such other information concerning the Company as he has requested.
(v) This Agreement constitutes the legal, valid and binding obligation of Executive, enforceable in accordance with its terms, and the execution, delivery and performance of this Agreement by Executive does not and will
not conflict with, violate or cause a breach of any agreement, contract or instrument to which Executive is a party or any judgment, order or decree to which Executive is subject.
(vi) Executive is a resident of the State of Florida.
(e) As an inducement to the Company to issue the Carried Units to Executive, and as a condition thereto, Executive acknowledges and agrees that neither the issuance of the Carried Units to
Executive nor any provision contained herein shall entitle Executive to remain in the employment of the Company, Employer or their respective Subsidiaries or affect the right of the Company, Employer or their respective Subsidiaries to terminate
Executive’s employment at any time for any reason.
(f) Concurrently with the execution of this
Agreement, Executive shall execute in blank ten security transfer powers in the form of Exhibit B attached hereto (the “Security Powers”) with respect to the Carried Units and shall deliver such Security Powers to the
Company. The Security Powers shall authorize the Company to assign, transfer and deliver the Carried Units to the appropriate acquiror thereof pursuant to Section 3 below and Section 6 of the Securityholders Agreement and under no
other circumstances.
(g) Executive is neither a party to, nor bound by, any other employment
agreement, consulting agreement, noncompete agreement, nonsolicitation agreement or
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confidentiality agreement.
2. Vesting of Carried Units.
(a) The Carried
Units shall be subject to vesting in the manner specified in this Section 2. Except as otherwise provided in Section 2(b) below, 5% of the Carried Units will become vested on each Quarter Date such that on June 3, 2007 the Carried
Units will be 100% vested, in each case, however, if and only if as of each such Quarter Date Executive has been continuously employed by the Company, Employer or any of their respective Subsidiaries from the date of this Agreement through and
including such Quarter Date.
(b) Upon the occurrence of a Sale of the Company, all Carried Units that
have not yet become vested shall become vested at the time of such event, if as of the date of such event Executive is still employed by the Company, Employer or any of their respective Subsidiaries. Carried Units that have become vested are
referred to herein as “Vested Units.” All Carried Units that have not vested are referred to herein as “Unvested Units.”
3. Repurchase Option.
(a) In the event Executive ceases to be employed by the Company, Employer or their respective Subsidiaries for any reason (the “Separation”), the Carried Units (whether held by Executive or one or more of
Executive’s transferees, other than the Company and the Investors) will be subject to repurchase, in each case by the Company and the Investors pursuant to the terms and conditions set forth in this Section 3 (the “Repurchase
Option”). The Company may assign its repurchase rights set forth in this Section 3 to any Person; provided that the Company may not assign to any Person its right to pay any portion of the Repurchase Price for Carried Units
repurchased hereunder in the form of Class A Preferred, as set forth in Section 3(e).
(b) In
the event of a Separation: (i) the purchase price for each Unvested Unit will be the lesser of (A) Executive’s Original Cost for such Unit and (B) the Fair Market Value of such Unit as of the date of Separation; and (ii) the purchase price for
each Vested Unit will be the Fair Market Value of such unit as of the date of the Separation.
(c) The
Board may elect to purchase all or any portion of the Unvested Units or the Vested Units by delivering written notice (the “Repurchase Notice”) to the holder or holders of the Carried Units within one year after the Separation. The
Repurchase Notice will set forth the number of Unvested Units and Vested Units to be acquired from each holder, the aggregate consideration to be paid for such units and the time and place for the closing of the transaction. The number of Carried
Units to be repurchased by the Company shall first be satisfied to the extent possible from the Carried Units held by Executive at the time of delivery of the Repurchase Notice. If the number of Carried Units then held by Executive is less than the
total number of Carried Units which the Company has elected to purchase, the Company shall purchase the remaining Carried Units elected to be purchased from the other holder(s) of Carried Units under this Agreement, pro rata according to the number
of Carried Units held by such other holder(s) at the time of delivery of such Repurchase Notice (determined as nearly as practicable to the nearest unit). The number of Unvested Units and Vested Units to be
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repurchased hereunder will be allocated among Executive and the other holders of Carried Units (if any) pro rata according to the number of
Carried Units to be purchased from such Person.
(d) If for any reason the Company does not elect to
purchase all of the Carried Units pursuant to the Repurchase Option, the Investors shall be entitled to exercise the Repurchase Option for all or any portion of the Carried Units the Company has not elected to purchase (the “Available
Units”). As soon as practicable after the Company has determined that there will be Available Units, but in any event within ten months after the Separation, the Company shall give written notice (the “Option Notice”) to
the Investors setting forth the number of Available Units and the purchase price for the Available Units. The Investors may elect to purchase any or all of the Available Units by giving written notice to the Company within one month after the Option
Notice has been given by the Company. If the Investors elect to purchase an aggregate number greater than the number of Available Units, the Available Units shall be allocated among the Investors based upon the number of Common Units owned by each
Investor. As soon as practicable, and in any event within ten days after the expiration of the one-month period set forth above, the Company shall notify each holder of Carried Units as to the number of units being purchased from such holder by the
Investors (the “Supplemental Repurchase Notice”). At the time the Company delivers the Supplemental Repurchase Notice to the holder(s) of Carried Units, the Company shall also deliver written notice to each Investor setting forth
the number of units such Investor is entitled to purchase, the aggregate purchase price and the time and place of the closing of the transaction. The number of Unvested Units and Vested Units to be repurchased hereunder shall be allocated among the
Company and the Investors pro rata according to the number of Carried Units to be purchased by each of them.
(e) The closing of the purchase of the Carried Units pursuant to the Repurchase Option shall take place on the date designated by the Company in the Repurchase Notice or Supplemental Repurchase Notice, which date shall not
be more than one month nor less than five days after the delivery of the later of either such notice to be delivered. The Company will pay for the Carried Units to be purchased by it pursuant to the Repurchase Option by first offsetting amounts
outstanding under any bona fide debts owed by Executive to the Company and will pay the remainder of the purchase price by, at its option, (A) a check or wire transfer of funds, (B) issuing in exchange for such securities a number of the
Company’s Class A Preferred (having the rights and preferences set forth in the LLC Agreement) equal to (x) the aggregate portion of the repurchase price for such Carried Units to be paid by the issuance of Class A Preferred divided by (y)
1,000, and for purposes of the LLC Agreement each such Class A Preferred unit shall as of its issuance be deemed to have Capital Contributions (as defined in the LLC Agreement) made with respect to such Class A Preferred unit equal to $1,000, or (C)
any combination of (A) and (B) as the Board may elect in its discretion. Each Investor will pay for the Carried Units purchased by it by a check or wire transfer of funds. The Company and the Investors will be entitled to receive customary
representations and warranties from the sellers regarding such sale and to require that all sellers’ signatures be guaranteed.
By way of example only for the purpose of clarifying the mechanics of Section 3(e)(B), if the Company intends to repurchase 45,045 Carried Units by issuance of Class A Preferred and the aggregate repurchase price
determined in accordance with this Section 3 is $1,500, then the Company would issue to Executive 1.5 units of Class A Preferred and for purposes of the LLC Agreement the whole unit of Class A Preferred issued to Executive would
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as of its issuance be deemed to have Capital Contributions made for such Class A Preferred of $1,000 and the Capital Contributions made for the
one-half unit of Class A Preferred would be $500.
(f) Notwithstanding anything to the contrary
contained in this Agreement, all repurchases of Carried Units by the Company pursuant to the Repurchase Option shall be subject to applicable restrictions contained in the Delaware Limited Liability Company Act, the Delaware General Corporation Law
or such other governing corporate law, and in the Company’s and its Subsidiaries’ debt and equity financing agreements. If any such restrictions prohibit (i) the repurchase of Carried Units hereunder which the Company is otherwise entitled
to make or (ii) dividends or other transfers of funds from one or more Subsidiaries to the Company to enable such repurchases, then the Company may make such repurchases as soon as it is permitted to make repurchases or receive funds from
Subsidiaries under such restrictions.
(g) Notwithstanding anything to the contrary contained in this
Agreement, if the Fair Market Value of the Carried Units is finally determined to be an amount at least 10% greater than the per unit repurchase price for such Carried Units in the Repurchase Notice or in the Supplemental Repurchase Notice, each of
the Company and the Investors shall have the right to revoke its exercise of the Repurchase Option for all or any portion of the Carried Units elected to be repurchased by it by delivering notice of such revocation in writing to the holders of
Carried Units during the thirty-day period beginning on the date that the Company and/or the Investors are given written notice that the Fair Market Value of Carried Units was finally determined to be an amount at least 10% greater than the per unit
repurchase price for Carried Units set forth in the Repurchase Notice or in the Supplemental Repurchase Notice.
(h) The provisions of this Section 3 shall terminate with respect to Vested Units upon the first to occur of the consummation of a Public Offering and the consummation of a Sale of the Company.
4. Restrictions on Transfer of Carried Units.
(a) Transfer of Carried Units. The holders of Carried Units shall not Transfer any interest in any
Carried Units, except pursuant to (i) the provisions of Section 3 hereof, (ii) the provisions of Section 3 of the Securityholders Agreement (a “Participating Sale”), (iii) an “Approved Sale” (as
defined in Section 6 of the Securityholders Agreement), or (iv) the provisions of Section 4(b) below.
(b) Certain Permitted Transfers. The restrictions in this Section 4 will not apply with respect to any Transfer of Carried Units made (i) pursuant to applicable laws of descent and
distribution or to such Person’s legal guardian in the case of any mental incapacity or among such Person’s Family Group, or (ii) at such time as the Investors sell Common Units in a Public Sale, but in the case of this clause (ii)
only an amount of units (the “Transfer Amount”) equal to the lesser of (A) the number of Vested Units owned by Executive and (B) the number of Common Units owned by Executive multiplied by a fraction (the “Transfer
Fraction”), the numerator of which is the number of Common Units sold by the Investors in such Public Sale and the denominator of which is the total number of Common Units held by the Investors prior to the Public Sale; provided
that, if at the time of a Public Sale of units by the Investors,
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Executive chooses not to Transfer the Transfer Amount, Executive shall retain the right to Transfer an amount of Common Units at a future date
equal to the lesser of (x) the number of Vested Units owned by Executive at such future date and (y) the number of Common Units owned by Executive at such future date multiplied by the Transfer Fraction; provided further that the restrictions
contained in this Section 4 will continue to be applicable to the Carried Units after any Transfer of the type referred to in clause (i) above and the transferees of such Carried Units must agree in writing to be bound by the provisions of
this Agreement. Any transferee of Carried Units pursuant to a Transfer in accordance with the provisions of this Section 4(b)(i) is herein referred to as a “Permitted Transferee.” Upon the Transfer of Carried Units pursuant
to this Section 4(b), the transferring holder of Carried Units will deliver a written notice (a “Transfer Notice”) to the Company. In the case of a Transfer pursuant to clause (i) hereof, the Transfer Notice will disclose in
reasonable detail the identity of the Permitted Transferee(s).
(c) Termination of
Restrictions. The restrictions set forth in this Section 4 will continue with respect to each unit of Carried Units until the earlier of (i) the date on which such Carried Units have been transferred in a Public
Sale permitted by this Section 4, or (ii) the consummation of an Approved Sale.
5. Additional Restrictions on Transfer of Carried Units.
(a) Legend. The certificates representing the Carried Units will bear a legend in substantially the following form:
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED AS OF JUNE 3, 2002, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “ACT”), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO
SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH IN A SENIOR MANAGEMENT AGREEMENT BETWEEN THE COMPANY AND AN EXECUTIVE OF THE COMPANY DATED AS OF JUNE 3, 2002. A COPY OF SUCH AGREEMENT
MAY BE OBTAINED BY THE HOLDER HEREOF AT THE COMPANY’S PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.”
(b) Opinion of Counsel. No holder of Carried Units may Transfer any Carried Units (except pursuant to an effective registration statement under the Securities Act) without first delivering to
the Company a written notice describing in reasonable detail the proposed Transfer, together with an opinion of counsel (reasonably acceptable in form and substance to the Company) that neither registration nor qualification under the Securities Act
and applicable state securities laws is required in connection with such transfer. In addition, if the holder of the Carried Units delivers to the Company an opinion of counsel that no subsequent Transfer of such Carried Units shall require
registration under the Securities Act, the Company shall promptly upon such contemplated Transfer deliver new certificates for such Carried Units which do not
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bear the Securities Act portion of the legend set forth in Section 5(a). If the Company is not required to deliver new certificates for
such Carried Units not bearing such legend, the holder thereof shall not Transfer the same until the prospective transferee has confirmed to the Company in writing its agreement to be bound by the conditions contained in this Section 5.
PROVISIONS RELATING TO EMPLOYMENT
6. Employment. Employer agrees to employ Executive and Executive accepts such employment for the period beginning as of the date hereof and ending upon his
separation pursuant to Section 6(c) hereof (the “Employment Period”).
(a) Position and Duties.
(i) During the Employment
Period, Executive shall serve as the Vice President—Sales of Employer and its Subsidiaries and shall have the normal duties, responsibilities and authority implied by such position, subject to the power of the Chief Executive Officer and the
Board to expand or limit such duties, responsibilities and authority and to override actions of Executive.
(ii) Executive shall report to the Chief Executive Officer and/or President of Employer and Executive shall devote his best efforts and his full business time and attention to the business and affairs of the Company,
Employer and their Subsidiaries.
(b) Salary, Bonus and Benefits. During
the Employment Period, Employer will pay Executive a base salary (the “Annual Base Salary”) of $130,000 per annum, subject to any increases as determined by the Board based upon the Company’s achievements of budgetary and other
objectives set by the Board. For any fiscal year, Executive shall be eligible for an annual bonus of up to 50% of the Executive’s then applicable Annual Base Salary based upon the achievement by the Company, Employer and their Subsidiaries of
budgetary and other objectives set by the Board; provided that with respect to the first year for which Executive is eligible for a bonus, such bonus shall be paid on a pro rata basis based upon that portion of the year that remained after
the date of this Agreement. In addition, during the Employment Period, Executive will be entitled to such other benefits approved by the Board and made available to the senior management of the Company, Employer and their Subsidiaries.
(c) Separation. The Employment Period will continue until Executive’s
resignation, disability (as determined by the Board in its good faith judgment) or death or until the Employer decides to terminate Executive’s employment with or without Cause. If Executive’s employment is terminated by Employer without
Cause, during the six-month period commencing on the date of termination (the “Initial Severance Period”), Employer shall pay to Executive each month during the Initial Severance Period an aggregate amount equal to 1/12th of his Annual Base Salary in effect as of the end of the Employment Period, payable in equal installments on
the Employer’s regular salary payment dates. Employer may (in its sole discretion) elect to extend the Initial Severance Period for up to three additional six-month periods (each an “Additional Severance Period”) by providing
Executive written notice of such extension no less than 60 days prior to the last day of the Initial Severance Period or the then
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effective Additional Severance Period and paying Executive during each month of any such Additional Severance Period an additional amount equal
to 1/12th of his Annual Base Salary, payable in equal installments on the Employer’s regular salary payment
dates. (The Initial Severance Period and all applicable Additional Severance Periods are collectively referred to herein as the “Severance Period”). The amounts payable pursuant to this Section 6(c) shall be reduced by the
amount of any compensation Executive earns or receives with respect to any other employment during the period in which he is receiving severance. Upon request from time to time, Executive shall furnish Employer with a true and complete certificate
specifying any such compensation earned or received by him while receiving any severance payments from Employer.
7. Confidential Information.
(a) Obligation to
Maintain Confidentiality. Executive acknowledges that the information, observations and data obtained by him during the course of his performance under this Agreement concerning the business and affairs of the Company,
Employer and their respective Subsidiaries and Affiliates are the property of the Company, Employer or such Subsidiaries and Affiliates, including information concerning acquisition opportunities in or reasonably related to the Company’s and
Employer’s and their respective Subsidiaries’ business or industry of which Executive becomes aware during the Employment Period. Therefore, Executive agrees that he will not disclose to any unauthorized Person or use for his own account
any of such information, observations or data without the Board’s prior written consent, unless and to the extent that the aforementioned matters become generally known to and available for use by the public other than as a result of
Executive’s acts or omissions to act. Executive agrees to deliver to the Company at Separation, or at any other time the Company may request in writing, all memoranda, notes, plans, records, reports and other documents (and copies thereof)
relating to the business of the Company, Employer and their respective Subsidiaries and Affiliates (including, without limitation, all acquisition prospects, lists and contact information) which he may then possess or have under his control.
(b) Ownership of Property. Executive acknowledges that all inventions,
innovations, improvements, developments, methods, processes, programs, designs, analyses, drawings, reports, and all similar or related information (whether or not patentable) that relate to the Company’s, Employer’s or any of their
respective Subsidiaries’ or Affiliates’ actual or anticipated business, research and development, or existing or future products or services and that are conceived, developed, contributed to, made, or reduced to practice by Executive
(either solely or jointly with others) while employed by the Company, Employer or any of their respective Subsidiaries or Affiliates (including any of the foregoing that constitutes any proprietary information or records) (“Work
Product”) belong to the Company, Employer or such Subsidiary or Affiliate and Executive hereby assigns, and agrees to assign, all of the above Work Product to the Company, Employer or to such Subsidiary or Affiliate. Any copyrightable work
prepared in whole or in part by Executive in the course of his work for any of the foregoing entities shall be deemed a “work made for hire” under the copyright laws, and the Company, Employer or such Subsidiary or Affiliate shall own all
rights therein. To the extent that any such copyrightable work is not a “work made for hire,” Executive hereby assigns and agrees to assign to the Company, Employer or such Subsidiary or Affiliate all right, title, and interest, including
without limitation, copyright in and to such copyrightable work. Executive shall promptly
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disclose such Work Product and copyrightable work to the Board and perform all actions reasonably requested by the Board (whether during or
after the Employment Period) to establish and confirm the Company’s, Employer’s or such Subsidiary’s or Affiliate’s ownership (including, without limitation, assignments, consents, powers of attorney, and other instruments).
(c) Third Party Information. Executive understands that the Company,
Employer and their respective Subsidiaries and Affiliates will receive from third parties confidential or proprietary information (“Third Party Information”) subject to a duty on the Company’s, Employer’s and their
respective Subsidiaries’ and Affiliates’ part to maintain the confidentiality of such information and to use it only for certain limited purposes. During the Employment Period and thereafter, and without in any way limiting the provisions
of Section 7(a) above, Executive will hold Third Party Information in the strictest confidence and will not disclose to anyone (other than personnel of the Company, Employer or their respective Subsidiaries or Affiliates who need to know such
information in connection with their work for the Company, Employer or their respective Subsidiaries or Affiliates) or use, except in connection with his work for the Company, Employer or their respective Subsidiaries or Affiliates, Third Party
Information unless expressly authorized by a member of the Board in writing.
(d) Use of Information
of Prior Employers. During the Employment Period, Executive will not improperly use or disclose any confidential information or trade secrets, if any, of any former employers or any other Person to whom Executive has an
obligation of confidentiality, and will not bring onto the premises of the Company, Employer or any of their respective Subsidiaries or Affiliates any unpublished documents or any property belonging to any former employer or any other Person to whom
Executive has an obligation of confidentiality unless consented to in writing by the former employer or Person. Executive will use in the performance of his duties only information which is (i) generally known and used by Persons with training and
experience comparable to Executive’s and that is (x) common knowledge in the industry or (y) is otherwise legally in the public domain, (ii) is otherwise provided or developed by the Company, Employer or any of their respective Subsidiaries or
Affiliates or (iii) in the case of materials, property or information belonging to any former employer or other Person to whom Executive has an obligation of confidentiality, approved for such use in writing by such former employer or Person.
8. Noncompetition and Nonsolicitation. Executive acknowledges that in
the course of his employment with Employer he will become familiar with the Company’s, Employer’s and their respective Subsidiaries’ trade secrets and with other confidential information concerning the Company, Employer and such
Subsidiaries and that his services will be of special, unique and extraordinary value to the Company and Employer and such Subsidiaries. Therefore, Executive agrees that:
(a) Noncompetition. During the Employment Period and (i) in the event of a termination of Executive’s employment by Employer
without Cause, the Severance Period or (ii) in the event of a termination of Executive’s employment for any other reason, for a period of two years thereafter (collectively, the “Noncompete Period”), he shall not, anywhere in
the world, directly or indirectly own, manage, control, participate in, consult with, render services for, or in any manner engage in any business relating to the provision of interoperability solutions,
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clearing and settlement services, software and network services and related services to telecommunications companies and other third parties
that compete with the businesses of the Company, Employer or their respective Subsidiaries or any business in which the Company, Employer or any of their respective Subsidiaries has entertained discussions or has requested and received information
relating to the acquisition of such business by the Company, Employer or their respective Subsidiaries prior to the Separation; provided, however, that the Executive may own up to 1% of any class of an issuer’s publicly traded
securities.
(b) Nonsolicitation. During the Noncompete Period, Executive
shall not directly or indirectly through another entity (i) induce or attempt to induce any employee of the Company, Employer or their respective Subsidiaries to leave the employ of the Company, Employer or such Subsidiary, or in any way interfere
with the relationship between the Company, Employer and any of their respective Subsidiaries and any employee thereof, (ii) hire any person who was an employee of the Company, Employer or any of their respective Subsidiaries within one year prior to
the time such employee was hired by Executive, (iii) induce or attempt to induce any customer, supplier, licensee or other business relation of the Company, Employer or any of their respective Subsidiaries to cease doing business with the Company,
Employer or such Subsidiary or in any way interfere with the relationship between any such customer, supplier, licensee or business relation and the Company and any Subsidiary or (iv) directly or indirectly acquire or attempt to acquire an interest
in any business relating to the business of the Company, Employer or any of their respective Subsidiaries and with which the Company, Employer and any of their respective Subsidiaries has entertained discussions or has requested and received
information relating to the acquisition of such business by the Company, Employer or any of their respective Subsidiaries in the two-year period immediately preceding a Separation.
(c) Enforcement. If, at the time of enforcement of Section 7 or this Section 8, a court holds that the restrictions
stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area and that
the court shall be allowed to revise the restrictions contained herein to cover the maximum duration, scope and area permitted by law. Because Executive’s services are unique and because Executive has access to confidential information, the
parties hereto agree that money damages would be an inadequate remedy for any breach of this Agreement. Therefore, in the event a breach or threatened breach of this Agreement, the Company, Employer, their respective Subsidiaries or Affiliates or
their successors or assigns may, in addition to other rights and remedies existing in their favor, apply to any court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations
of, the provisions hereof (without posting a bond or other security).
(d) Additional
Acknowledgments. Executive acknowledges that the provisions of this Section 8 are in consideration of: (i) employment with the Employer, (ii) the issuance of the Carried Units by the Company and (iii) additional
good and valuable consideration as set forth in this Agreement. In addition, Executive agrees and acknowledges that the restrictions contained in Section 7 and this Section 8 do not preclude Executive from earning a livelihood, nor do
they unreasonably impose limitations on Executive’s ability to earn a living. In addition, Executive acknowledges (i) that the business of the Company, Employer and
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their respective Subsidiaries will be international in scope and without geographical limitation, (ii) notwithstanding the state of
incorporation or principal office of the Company, Employer or any of their respective Subsidiaries, or any of their respective executives or employees (including the Executive), it is expected that the Company and Employer will have business
activities and have valuable business relationships within its industry throughout the world, and (iii) as part of his responsibilities, Executive will be traveling in furtherance of Employer’s business and its relationships. Executive agrees
and acknowledges that the potential harm to the Company and Employer and their respective Subsidiaries of the non-enforcement of Section 7 and this Section 8 outweighs any potential harm to Executive of its enforcement by injunction or
otherwise. Executive acknowledges that he has carefully read this Agreement and has given careful consideration to the restraints imposed upon Executive by this Agreement, and is in full accord as to their necessity for the reasonable and proper
protection of confidential and proprietary information of the Company and Employer now existing or to be developed in the future. Executive expressly acknowledges and agrees that each and every restraint imposed by this Agreement is reasonable with
respect to subject matter, time period and geographical area.
GENERAL PROVISIONS
9. Definitions.
“Affiliate” means, (i) with respect to any Person, any Person that controls, is controlled by or is under common control with such Person or an Affiliate of such Person, and (ii) with
respect to any Investor, any general or limited partner of such Investor, any employee or owner of any such partner, or any other Person controlling, controlled by or under common control with such Investor.
“Board” means the Board of Managers of the Company.
“Class A Preferred” means the Class A Preferred Units as defined in the LLC Agreement.
“Carried Units” will continue to be Carried Units in the hands of any holder other than Executive (except for the Company and the Investors and except for
transferees in a Public Sale), and except as otherwise provided herein, each such other holder of Carried Units will succeed to all rights and obligations attributable to Executive as a holder of Carried Units hereunder. Carried Units will also
include equity of the Company (or a corporate successor to the Company) issued with respect to Carried Units (i) by way of a unit split, unit dividend, conversion, or other recapitalization (excluding any Class A Preferred issued herein) or (ii) by
way of reorganization or recapitalization of the Company in connection with the incorporation of a corporate successor prior to a Public Offering. Notwithstanding the foregoing, all Unvested Units shall remain Unvested Units after any Transfer
thereof.
“Cause” means (i) the commission of a felony or a crime involving moral turpitude or
the commission of any other act or omission involving dishonesty or fraud with respect to the Company, Employer or any of their respective Subsidiaries or any of their customers or suppliers, (ii) conduct tending to bring the Company, Employer or
any of their respective Subsidiaries into substantial public disgrace or disrepute, (iii) substantial and repeated
11
failure to perform duties of the office held by Executive as reasonably directed by the Board, (iv)
gross negligence or willful misconduct with respect to the Company, Employer or any of their respective Subsidiaries or (v) any breach of Sections 6(a)(ii), 7 or 8 of this Agreement.
“Fair Market Value” of Carried Units means the average of the closing prices of the sales of such Carried Units on all
securities exchanges on which such Carried Units may at the time be listed, or, if there have been no sales on any such exchange on any day, the average of the highest bid and lowest asked prices on all such exchanges at the end of such day, or, if
on any day such Carried Units is not so listed, the average of the representative bid and asked prices quoted in the NASDAQ System as of 4:00 P.M., New York time, or, if on any day such Carried Units are not quoted in the NASDAQ System, the average
of the highest bid and lowest asked prices on such day in the domestic over-the-counter market as reported by the National Quotation Bureau Incorporated, or any similar successor organization, in each such case averaged over a period of 21 days
consisting of the day as of which the Fair Market Value is being determined and the 20 consecutive business days prior to such day. If at any time such Carried Units are not listed on any securities exchange or quoted in the NASDAQ System or the
over-the-counter market, the Fair Market Value will be the fair value of such Carried Units as determined in good faith by the Board. If Executive reasonably disagrees with such determination, Executive shall deliver to the Board a written notice of
objection within ten days after delivery of the Repurchase Notice (or if no Repurchase Notice is delivered, then within ten days after delivery of the Supplemental Repurchase Notice). Upon receipt of Executive’s written notice of objection, the
Board and Executive will negotiate in good faith to agree on such Fair Market Value. If such agreement is not reached within 30 days after the delivery of the Repurchase Notice (or if no Repurchase Notice is delivered, then within 30 days after the
delivery of the Supplemental Repurchase Notice), Fair Market Value shall be determined by an appraiser jointly selected by the Board and Executive, which appraiser shall submit to the Board and Executive a report within 30 days of its engagement
setting forth such determination. If the parties are unable to agree on an appraiser within 45 days after delivery of the Repurchase Notice or the Supplemental Repurchase Notice, within seven days, each party shall submit the names of four
nationally recognized firms that are engaged in the business of valuing non-public securities, and each party shall be entitled to strike two names from the other party’s list of firms, and the appraiser shall be selected by lot from the
remaining four firms. The expenses of such appraiser shall be borne by Executive unless the appraiser’s valuation is more than 10% greater than the amount determined by the Board, in which case, the expenses of the appraiser shall be borne by
the Company. The determination of such appraiser as to Fair Market Value shall be final and binding upon all parties.
“Family Group” means, with respect to a Person who is an individual, such Person’s spouse and descendants (whether natural or adopted), and any trust, family limited partnership, limited liability company or
other entity wholly owned, directly or indirectly, by such Person or such Person’s spouse and/or descendants that is and remains solely for the benefit of such Person and/or such Person’s spouse and/or descendants and any retirement plan
for such Person.
“GAAP” means United States generally accepted accounting principles as in
effect from time to time.
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“LLC Agreement” means the Limited Liability Company Agreement of
the Company, as amended from time to time pursuant to its terms.
“Original Cost” means, with
respect to each Common Unit purchased hereunder, $0.0333 (as proportionately adjusted for all subsequent unit splits, unit dividends and other recapitalizations).
“Person” means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture,
an unincorporated organization, investment fund, any other business entity and a governmental entity or any department, agency or political subdivision thereof.
“Public Offering” means the sale in an underwritten public offering registered under the Securities Act of equity securities of the Company or a corporate successor to the Company.
“Public Sale” means (i) any sale pursuant to a registered public offering under the Securities
Act or (ii) any sale to the public pursuant to Rule 144 promulgated under the Securities Act effected through a broker, dealer or market maker (other than pursuant to Rule 144(k) prior to a Public Offering).
“Purchase Agreement” means that certain Unit Purchase Agreement dated as of February 14, 2002 by and between the Company
and the Investors, as amended from time to time pursuant to its terms.
“Quarter Date” means
June, September, December and March of each year beginning on September 3, 2002 and ending on June 3, 2007.
“Sale of the Company” means any transaction or series of transactions pursuant to which any Person or group of related Persons other than the Investors or their Affiliates in the aggregate acquire(s) (i) equity
securities of the Company possessing the voting power (other than voting rights accruing only in the event of a default, breach or event of noncompliance) to elect a majority of the Company’s board of managers (whether by merger, consolidation,
reorganization, combination, sale or transfer of the Company’s equity, securityholder or voting agreement, proxy, power of attorney or otherwise) or (ii) all or substantially all of the Company’s assets determined on a consolidated basis;
provided that a Public Offering shall not constitute a Sale of the Company.
“Securities
Act” means the Securities Act of 1933, as amended from time to time.
“Securityholders
Agreement” means the Securityholders Agreement of even date herewith among the Company and certain of its securityholders, as amended from time to time pursuant to its terms.
“Subsidiary” means, with respect to any Person, any corporation, limited liability company, partnership, association, or business entity of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, or trustees thereof is at the time
13
owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or
(ii) if a limited liability company, partnership, association, or other business entity (other than a corporation), a majority of partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by
that Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association, or other
business entity (other than a corporation) if such Person or Persons shall be allocated a majority of limited liability company, partnership, association, or other business entity gains or losses or shall be or control any managing director or
general partner of such limited liability company, partnership, association, or other business entity. For purposes hereof, references to a “Subsidiary” of any Person shall be given effect only at such times that such Person has one
or more Subsidiaries, and, unless otherwise indicated, the term “Subsidiary” refers to a Subsidiary of the Company.
“Transfer” means to sell, transfer, assign, pledge or otherwise dispose of (whether with or without consideration and whether voluntarily or involuntarily or by operation of law).
10. Notices. Any notice provided for in this Agreement must be in writing and must be either
personally delivered, mailed by first class mail (postage prepaid and return receipt requested) or sent by reputable overnight courier service (charges prepaid) to the recipient at the address below indicated:
If to Employer:
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxx
Xxxxxx, Jr.
with copies to:
GTCR Fund VII, L.P.
GTCR Fund VII/A, L.P.
GTCR Co-Invest, L.P.
c/o
GTCR Xxxxxx Xxxxxx, L.L.C.
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxxx
Xxxxxx X. Xxxxx
and
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
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Attention: Xxxxxxx X. Xxxxxxx
If to the Company:
TSI Telecommunication
Holdings, LLC
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxx
00000
Attention: Xxxxxx Xxxxxx, Jr.
with copies to:
GTCR Fund VII, L.P.
GTCR Fund VII/A, L.P.
GTCR Co-Invest, L.P.
c/o GTCR Xxxxxx Xxxxxx, L.L.C.
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxx
00000-0000
Attention: Xxxxx X. Xxxxxxx
Xxxxxx X. Xxxxx
and
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
If to Executive:
Xxxxxxx Xxxxxxx
0000 Xxxxxxxxxx Xxxxx
Xxxxx, Xxxxx 00000
If to the Investors:
GTCR Fund VII, L.P.
GTCR Fund VII/A, L.P.
GTCR Co-Invest, L.P.
c/o GTCR Xxxxxx Xxxxxx, L.L.C.
15
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxxx
Xxxxxx X. Xxxxx
with a copy to:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx
00000
Attention: Xxxxxxx X. Xxxxxxx
or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Agreement will be deemed to have been given when so
delivered or sent or, if mailed, five days after deposit in the U.S. mail.
11. General
Provisions.
(a) Transfers in Violation of Agreement. Any Transfer or
attempted Transfer of any Carried Units in violation of any provision of this Agreement shall be void, and the Company shall not record such Transfer on its books or treat any purported transferee of such Carried Units as the owner of such equity
for any purpose.
(b) Severability. Whenever possible, each provision of
this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision had never been contained herein.
(c) Complete
Agreement. This Agreement, those documents expressly referred to herein and other documents of even date herewith embody the complete agreement and understanding among the parties and supersede and preempt any prior
understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.
(d) Counterparts. This Agreement may be executed in separate counterparts (including by means of facsimile), each of which is deemed to be an original and all
of which taken together constitute one and the same agreement.
(e) Successors and
Assigns. Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by Executive, the Company, the Employer, the Investors and their respective successors and assigns
(including subsequent holders of Carried Units); provided that the rights and obligations of Executive under this Agreement shall not be assignable except in connection with a permitted transfer of Carried
16
Units hereunder.
(f) Choice of Law. The limited liability company law of the State of Delaware will govern all questions concerning the relative rights of the Company and its securityholders. All other
questions concerning the construction, validity and interpretation of this Agreement and the exhibits hereto will be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to any choice of law
or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.
(g) Remedies. Each of the parties to this Agreement (including the Investors as third-party
beneficiaries) will be entitled to enforce its rights under this Agreement specifically, to recover damages and costs (including attorney’s fees) caused by any breach of any provision of this Agreement and to exercise all other rights existing
in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent
jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Agreement.
(h) Amendment and Waiver. The provisions of this Agreement may be amended and waived only with the prior written consent of the
Company, Employer, Executive and the Majority Holders (as defined in the Purchase Agreement).
(i) Insurance. The Company or Employer, at its discretion, may apply for and procure in its own name and for its own benefit life and/or disability insurance on Executive in any amount or
amounts considered available. Executive agrees to cooperate in any medical or other examination, supply any information, and to execute and deliver any applications or other instruments in writing as may be reasonably necessary to obtain and
constitute such insurance. Executive hereby represents that he has no reason to believe that his life is not insurable at rates now prevailing for healthy men of his age.
(j) Business Days. If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or
holiday in the state in which the Company’s chief executive office is located, the time period shall be automatically extended to the business day immediately following such Saturday, Sunday or holiday.
(k) Indemnification and Reimbursement of Payments on Behalf of Executive. The Company, Employer
and their respective Subsidiaries shall be entitled to deduct or withhold from any amounts owing from the Company or any of its Subsidiaries to Executive any federal, state, local or foreign withholding taxes, excise taxes, or employment taxes
(“Taxes”) imposed with respect to Executive’s compensation or other payments from the Company or any of its Subsidiaries or Executive’s ownership interest in the Company, including, without limitation, wages, bonuses,
dividends, the receipt or exercise of equity options and/or the receipt or vesting of restricted equity. In the event the Company or its Subsidiaries does not make such deductions or withholdings, Executive shall indemnify the Company and its
Subsidiaries for any amounts paid with respect to any such Taxes, together with any interest, penalties and related expenses
17
thereto.
(l) Reasonable Expenses. The Company agrees to pay the reasonable fees and expenses of Executive’s counsel arising in connection with the negotiation and execution of this Agreement and
the consummation of the transactions contemplated by this Agreement.
(m) Termination. This Agreement (except for the provisions of Sections 6(a) and (b)) shall survive a Separation and shall remain in full force and effect after such Separation.
(n) Adjustments of Numbers. All numbers set forth herein that refer to
unit prices or amounts will be appropriately adjusted to reflect unit splits, unit dividends, combinations of units and other recapitalizations affecting the subject class of equity.
(o) Deemed Transfer of Carried Units. If the Company (and/or the Investors and/or any other Person acquiring securities) shall make
available, at the time and place and in the amount and form provided in this Agreement, the consideration for the Carried Units to be repurchased in accordance with the provisions of this Agreement, then from and after such time, the Person from
whom such units are to be repurchased shall no longer have any rights as a holder of such units (other than the right to receive payment of such consideration in accordance with this Agreement), and such units shall be deemed purchased in accordance
with the applicable provisions hereof and the Company (and/or the Investors and/or any other Person acquiring securities) shall be deemed the owner and holder of such units, whether or not the certificates therefor have been delivered as required by
this Agreement.
(p) No Pledge or Security Interest. The purpose of the
Company’s retention of Executive’s certificates and executed security powers is solely to facilitate the repurchase provisions set forth in Section 3 herein and Section 6 of the Securityholders Agreement and does not
constitute a pledge by Executive of, or the granting of a security interest in, the underlying equity.
(q) Rights Granted to GTCR Fund VII and its Affiliates. Any rights granted to GTCR Fund VII, GTCR Fund VII/A, GTCR Co-Invest and their Affiliates hereunder may also be exercised (in whole or
in part) by their respective designees (which designees may be Affiliates of GTCR Fund VII, GTCR Fund VII/A and/or GTCR Co-Invest).
* * * * *
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IN WITNESS WHEREOF, the parties hereto have executed this Senior Management
Agreement on the date first written above.
| TSI TELECOMMUNICATION HOLDINGS, LLC | ||
| By: |
/s/ G. XXXXXX XXXXX | |
| Its: |
Chief Executive Officer | |
| TSI TELECOMMUNICATION SERVICES, INC. |
||
| By: |
/s/ G. XXXXXX XXXXX | |
| Its: |
Chief Executive Officer | |
| /s/ XXXXXXX XXXXXXX |
| Xxxxxxx Xxxxxxx |
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Agreed and Accepted:
| GTCR FUND VII, L.P. | ||
| By: |
GTCR PARTNERS VII, L.P. | |
| Its: |
General Partner | |
| By: |
GTCR XXXXXX XXXXXX, L.L.C. | |
| Its: |
General Partner | |
| By: |
/s/ XXXXX X. XXXXXXX | |
| Name: |
Xxxxx X. Xxxxxxx | |
| Its: |
Principal | |
| GTCR FUND VII/A, L.P. | ||
| By: |
GTCR PARTNERS VII, L.P. | |
| Its: |
General Partner | |
| By: |
GTCR XXXXXX XXXXXX, L.L.C. | |
| Its: |
General Partner | |
| By: |
/s/ XXXXX X. XXXXXXX | |
| Name: |
Xxxxx X. Xxxxxxx | |
| Its: |
Principal | |
| GTCR CO-INVEST, L.P. | ||
| By: |
GTCR XXXXXX XXXXXX, L.L.C. | |
| Its: |
General Partner | |
| By: |
/s/ XXXXX X. XXXXXXX | |
| Name: |
Xxxxx X. Xxxxxxx | |
| Its: |
Principal | |
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