Exhibit 10.1
EMPLOYMENT AGREEMENT
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This AGREEMENT (the "Agreement"), is made as of the 3rd day of
October, 2001 (the "Effective Date"), among Global Crossing Ltd., a Bermuda
corporation ("GX"), Asia Global Crossing Ltd., a Bermuda corporation ("AX"), and
Xxxx X. Xxxxxx ("Executive").
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, GX, AX and Executive hereby agree as follows:
1. Employment.
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Subject to the terms and conditions hereinafter contained, GX hereby
employs Executive and Executive accepts the employment by GX.
(a) During the Term (as defined below), Executive shall hold the
title of Chief Executive Officer ("CEO") of GX and Director of GX, shall be the
most senior officer of GX, other than the Chairman of GX (the "Chairman"), and
shall have those powers and duties normally associated with the position of CEO
and such other powers and duties consistent with such position as may be
prescribed by the Board of Directors of GX (the "Board"). Executive shall be
appointed as a Director of GX effective as of the date of Executive's
appointment as CEO of GX. During the Term, Executive shall report directly to
the Chairman and the Board in carrying out his responsibilities under this
Agreement. Executive's principal business locations shall be at GX's executive
offices in Los Angeles, California, and at GX's principal executive offices to
be established at a mutually agreed-upon location in New York/New Jersey as to
which Executive's consent shall not be unreasonably withheld.
(b) In addition to his positions at GX, consistent with the
employment agreement between Executive and AX, dated February 12, 2000, as
amended (the "AX Employment Agreement"), Executive shall continue to hold the
titles of CEO of AX and Director of AX; provided that, at such time, if any, as
AX becomes more than 80% owned or controlled by, or an integrated division of,
GX (the consummation of such event being referred to herein as the "Transition
Date"), the Board of Directors of AX may, in its discretion, terminate the AX
Employment Agreement (such termination being referred to herein as a "Transition
Termination"). Upon any termination of Executive's employment with AX, he shall
recommend to the AX Board his successor as Chief Executive Officer of AX. Except
as expressly provided herein or amended hereby, until the occurrence of a
Transition Termination, the AX Employment Agreement, and the executive
compensation and other compensation and benefit arrangements established
pursuant thereto, including, without limitation, the AX Change in Control
Agreement, as hereinafter defined, shall continue in full force and effect, and
shall be independent obligations of AX, and Executive shall continue to report
to the Chairman of AX and the Board of Directors of AX (the "AX Board") in
carrying out his responsibilities under the AX Employment Agreement. The term of
the AX Employment Agreement shall be deemed extended by this Agreement so that
it continues in accordance with its terms until the earlier of a Transition
Termination or, unless otherwise provided herein, the termination of this
Agreement in accordance with its terms. Following any such
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termination, AX shall have no further obligations under the AX Employment
Agreement, other than with respect to AX liabilities or obligations arising
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thereunder, or under related AX agreements, (i) for indemnification as a result
of acts occurring during, (ii) for payments of compensation or benefits due for,
or (iii) under grants or awards entered into during, the period ended on or
prior to the Transition Date (collectively, "Continuing Obligations"); provided
that Continuing Obligations shall not include any AX liabilities or AX
obligations that are assumed by another party, except to the extent otherwise
specifically provided hereunder or under any related agreement. Following the
Transition Date, Executive shall not be deemed to have terminated his employment
with AX for purposes of any AX stock option agreement until such time as he has
terminated his employment with GX. AX shall not in any event be relieved from
liability for satisfaction of the Continuing Obligations until such time as they
have been discharged in full.
(c) During the Term, all executive officers of GX other than the
Chairman and the Co-Chairman, and all executive officers of AX other than the
Chairman and the Co-Chairman, shall report to Executive.
(d) Executive shall faithfully serve GX and AX to the utmost of his
ability and shall use his best efforts to promote the interests of GX and AX and
shall devote all of his time and attention during the normal working hours of GX
and AX (and, for no further remuneration, during such additional hours as shall
be necessary for the proper performance thereof) to the said duties, except
insofar as he has the consent of the GX Board (in the case of GX) or the AX
Board (in the case of AX) in writing to do otherwise. Time devoted by Executive
in the reasonable exercise of his discretion to AX matters shall not be treated
by GX as inconsistent with or in breach of Executive's obligations to GX under
this Agreement. Executive's obligation to devote full time services under the AX
Employment Agreement shall be deemed modified to the extent Executive performs
the services required of him under this Agreement. The foregoing shall not
preclude Executive from engaging in appropriate civic, charitable or religious
activities or from devoting a reasonable amount of time to private investments
or, subject to Board approval, from serving on the boards of directors of other
entities, as long as none of such activities, investments and service materially
interfere or conflict with Executive's responsibilities to GX or compete,
directly or indirectly, with GX or its affiliates. This Section 1(d) supersedes
Section 1(b) of the AX Employment Agreement in its entirety.
(e) Executive shall comply with such directives and manuals as GX may
issue from time to time to its officers and executives.
2. Term.
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Subject to the provisions of Section Error! Reference source not
found. below, the term of this Agreement (the "Term") shall be 3 years,
commencing on the Effective Date. Subject to Section Error! Reference source not
found. below, the Term and provisions of this Agreement shall automatically
extend for an additional one-year period first on the date which is 6 months
prior to the third anniversary (the "Extension Date"), and on each subsequent
anniversary of the Extension
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Date thereafter, unless either party notifies the other in writing at least 6
months prior to the applicable anniversary of the Extension Date that the Term
shall not be so extended. Upon such notice of non-extension, Executive's
employment hereunder shall terminate on the close of business on the day
immediately preceding the applicable anniversary.
3. Remuneration. Prior to a Transition Termination, Executive shall
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continue to receive compensation pursuant to, and in accordance with, the terms
of the AX Employment Agreement, which are incorporated herein by reference.
However, all cash compensation payable under Section Error! Reference source not
found.(a) and 3(c) hereof during or with respect to the period from the
Effective Date until the date of a Transition Termination, to the extent
properly allocable to such period, shall be offset by cash compensation actually
paid by AX pursuant to the AX Employment Agreement. Following the Effective
Date, the AX Employment Agreement shall no longer confer on Executive any rights
in respect of new grants or awards under AX executive compensation or other
incentive compensation plans or arrangements (except to the extent contemplated
in the immediately following two sentences), and Executive shall commence
participation in the GX welfare and insurance benefit arrangements, and cease
participation in the AX welfare and insurance benefit arrangements (other than
indemnification and directors' and officers' liability arrangements, which shall
continue in effect for as long as Executive serves as an officer or director of
AX), on or as soon as practicable after the Effective Date, so that there is no
duplication or loss of coverage. Cash compensation required to be paid under
this Agreement and the AX Employment Agreement, including, without limitation,
salary, bonus and amounts due in respect of forgiveness, gross up and tax
withholding obligations under the loan described in Section 3(g) below, may be
allocated between AX and GX and paid as determined by the respective
Compensation Committees of AX and GX after taking into consideration the time
commitment of Executive to each of the two companies and such other factors as
such committees shall deem appropriate; provided, however, that any liabilities
under either employment agreement, or any under any related AX or GX
compensation plan or agreement, which are not paid and effectively discharged
for any reason when due, shall be continuing obligations of the applicable
employer obligor until its respective obligations, including gross up and tax
withholding obligations, have been discharged in full. The AX Compensation
Committee may in its sole discretion grant to Executive equity incentive
compensation awards in the future; provided that nothing herein shall prevent
each of the AX Compensation Committee and the GX Compensation Committee from
taking into account awards granted by the other prior to the granting of any
such award.
(a) Base Salary. GX agrees to pay and Executive agrees to accept as
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compensation for the services rendered by Executive during his employment
hereunder an annualized salary of $1,100,000 ("Base Salary") less withholding
taxes and other amounts required by applicable laws, to be paid in semi-monthly
installments.
(b) Signing Bonus. On the date on which this Agreement is executed,
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GX shall pay Executive a signing bonus (the "Signing Bonus"), by wire transfer
in readily available US federal funds, in the net after-tax amount of
$3,500,000.
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(c) Annual Bonus. Executive's annual bonus for 2001 shall be
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determined under the AX annual incentive plan in accordance with the performance
criteria and bonus opportunity previously established for and communicated to
Executive. Executive shall be eligible to receive an annual bonus ("Annual
Bonus") in accordance with GX's annual incentive plan beginning with the bonus
payable in respect of the fiscal year of GX commencing January 1, 2002. The
amount of the Annual Bonus shall be determined based upon the achievement of
established performance goals which, to the extent related to corporate goals,
shall be the same for Executive as other members of GX's senior executive team,
and to the extent related to individual goals, shall be as determined by the
Compensation Committee of the Board (the "Compensation Committee"). Upon
achievement of performance goals at target level, Executive shall receive an
Annual Bonus equal to 125% of Base Salary, with scaling of Annual Bonus in
accordance with plan parameters based on performance above or below target
performance.
(d) GX Stock Options. On the date hereof, Executive shall be granted
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options to purchase 5,000,000 shares of GX common stock (the "GX Stock Options")
at an exercise price per share equal to the average of the closing prices of GX
common stock on the New York Stock Exchange ("NYSE") during the ten consecutive
NYSE trading days commencing with September 27, 2001. GX represents that all
necessary approvals for such grant have been obtained prior to the execution of
this Agreement. The GX Stock Options shall vest and become exercisable as
follows: one-third (1/3) immediately on the date of grant, one-third (1/3) on
the first anniversary of the Effective Date, and the final one-third (1/3) on
the second anniversary of the Effective Date. The GX Stock Options shall be
subject to additional terms and conditions, not inconsistent with this
Agreement, as may be determined by the Compensation Committee; provided,
however, that Executive's prior approval shall be required for any terms and
conditions which are less favorable to Executive than the terms and conditions
of GX's 1998 Stock Incentive Plan (the "Incentive Plan") and standard form
Non-Qualified Stock Option Agreement, copies of which have been heretofore filed
with the Securities and Exchange Commission and are incorporated herein by
reference. Following the initial grant, Executive shall be eligible to receive
future annual grants on a basis consistent with customary practice for other
senior executives of GX.
(e) AX Stock Options. AX, GX and Executive agree, and in approving
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this Agreement, the Compensation Committee of the AX Board and the Compensation
Committee agree, that notwithstanding any authority granted to either such
committee under any AX or GX stock option plan currently in effect or
hereinafter established, or under any of Executive's AX stock option agreements,
all such options held by Executive on the Effective Date to purchase shares of
AX common stock (the "AX Stock Options") will be converted, as of the Transition
Date, to options to acquire shares of GX common stock on a value equivalent
basis and in a manner consistent with customary option conversion practices.
Following such conversion, except as otherwise specifically provided herein,
converted AX Stock Options shall continue to vest at the same times, and shall
otherwise be subject to the same terms and conditions as applied to the AX Stock
Options immediately prior to such conversion.
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(f) Change in Control of GX. Executive is currently a party to a
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Change in Control Agreement with AX (the "AX Change in Control Agreement").
Contemporaneously with the execution of this Agreement, Executive and GX shall
enter into a Change in Control Agreement (the "GX Change in Control Agreement").
Notwithstanding anything herein or in the AX or GX Change in Control Agreements
to the contrary, (i) in the event of a substantially simultaneous "Change in
Control" under both agreements, Executive shall in no event be entitled to
duplication of benefits provided under such agreements, and (ii) Executive shall
not be entitled to Change in Control benefits solely because of the consummation
of a transaction between GX and AX unless it involves an independent event that
is otherwise treated as a Change in Control under the applicable Change in
Control Agreement.
(g) AX Loan.
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(i) Pursuant to Section 3(e) of the AX Employment Agreement,
Executive and AX are parties to a promissory note in the amount of $15,000,000
(the "Promissory Note"). In accordance with the Second Amendment to the AX
Employment Agreement, AX has agreed to provide Executive with a gross-up payment
in an amount necessary to cover all taxes on imputed interest income arising out
of the Promissory Note. In addition, pursuant to Section 2 of the Promissory
Note, AX has forgiven $5,000,000 in principal on February 1, 2001.
(ii) As of the Effective Date, Section 2 of the Promissory Note
is hereby amended to modify the schedule of forgiveness of the remaining
$10,000,000 of principal such that $5,000,000 of principal shall be forgiven on
October 1, 2002 and $5,000,000 of principal shall be forgiven on February 1,
2003, provided Executive is employed by either AX or GX on the applicable date.
In addition, at such times as are provided in the following sentence, GX shall
pay Executive an additional amount (a "Tax Indemnity Payment") sufficient to
cover all applicable foreign, federal, state and local taxes, including, without
limitation, all income and employment taxes, on the amounts forgiven under the
Promissory Note and an additional amount sufficient to cover all such taxes
arising from the applicable Tax Indemnity Payment. The Tax Indemnity Payment
attributable to the February 1, 2001 principal amount forgiven shall be made by
GX on January 1, 2002, and the Tax Indemnity Payments attributable to the other
principal amounts on shall be made by GX on the applicable forgiveness date.
Executive hereby consents to any assignment of the Promissory Note in whole or
in part to GX or any subsidiary thereof, but any such assignment shall be
effective only if the assignee has hereby assumed (in the case of GX), or
contemporaneously assumes, in writing, in form satisfactory to Executive, (in
the case of any subsidiary of GX), the obligations to Executive set forth under
this Section 3(g)(ii). Notwithstanding the preceding sentence, if the assigned
obligations under this Section 3(g)(ii) are not completely and fully discharged,
when due, or if the obligations are performed but are thereafter set aside for
any reason, any such assignment shall be reversed and the original obligations
to Executive of the preceding assignor(s) under this Section 3(g)(ii) shall be
reinstated, as of the date the applicable obligations were originally created.
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(h) Withholding. All payments required under this Agreement shall be
made net of withholding for taxes and other amounts required by applicable laws,
which shall be paid by the withholding agent to the applicable tax authorities
within the time prescribed by law.
4. Perquisites and Benefits.
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(a) General. Executive shall be eligible to participate in all GX
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benefits and Executive shall be treated in the same manner as, and shall be
entitled to benefits and other perquisites no less favorable than those provided
to, the most senior officers of GX.
(b) Relocation. Prior to any relocation of Executive to New York/ New
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Jersey, GX shall lease an apartment in New York/New Jersey for Executive's use.
In the event of Executive's relocation to New York/New Jersey, Executive shall
receive relocation benefits as provided in GX's relocation policy, a copy of
which is annexed hereto as Attachment "A" hereto and incorporated by reference.
5. Vacation.
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(a) Executive shall be entitled to four weeks of paid vacation per
year. Executive shall not accrue more than four weeks paid vacation.
(b) On termination of Executive's employment for whatever reason,
Executive shall be entitled to accrued vacation pay through the date of
termination.
6. Expense Reimbursements.
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Executive shall be reimbursed for reasonable business expenses
incurred by Executive on behalf of GX, including, but not limited to, travel and
entertainment expenses, in accordance with GX policies. Business travel shall be
by first class air.
7. Termination/Resignation.
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Subject to the provisions below, Executive may be terminated by GX at
any time, with or without cause. Executive may resign at any time for any
reason.
(a) Death or Disability. In the event Executive's employment is
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terminated by GX due to death of Executive or due to a disability which renders
Executive unable to fulfill his duties on a full-time basis for more than 180
consecutive days (a "Disability"), then Executive or his estate shall receive
(i) Base Salary through the date of termination, (ii) any unpaid Annual Bonus
relating to the year immediately prior to the year in which the Termination Date
occurs, and a pro rata Annual Bonus (calculated by assuming that target level
performance was attained) for the year of such termination, (iii) accrued but
unused vacation, and (iv) reimbursement for unreimbursed business expenses
incurred pursuant to Section Error! Reference source not found. hereof
(collectively, "Accrued Obligations"). In addition, (A) all unvested options to
acquire shares of GX held by Executive on the date of such termination shall
become immediately vested, and
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Executive or his successors, or Executive's estate, as applicable, shall
have the right to exercise such options for 12 months from Executive's date of
termination, or if shorter, for the balance of the unexpired term ("Full Option
Vesting and Extended Exercise Rights"), (B) all remaining outstanding principal
and accrued interest on the Promissory Note shall be forgiven effective as of
the date of such termination ("Loan Forgiveness"), and (C) at the same time, GX
shall pay Executive an additional amount sufficient to cover all foreign,
federal, state and local taxes, including, without limitation, all income and
employment taxes, on the amounts forgiven hereunder and an additional amount
sufficient to cover all such taxes arising from the payments made pursuant to
clause (B) and this clause (C) (the "Gross-Up Payment").
(b) Termination For Cause. Actions or omissions which will entitle
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GX to terminate Executive for cause ("Termination for Cause") shall be:
(i) conviction of a felony; or conviction of a crime of moral
turpitude which causes serious economic injury or serious
injury to GX's reputation; or
(ii) material breach of the Proprietary Information Agreement as
described in Section Error! Reference source not found.
hereof; or
(iii) fraud or embezzlement; intentional misconduct or gross
negligence which has caused serious and demonstrable injury
to GX or its affiliates; or breach of Paragraph Error!
Reference source not found. or Error! Reference source not
found. of this Agreement; or
(iv) egregious performance or failure to perform Executive's
duties as CEO of GX; provided that a failure to achieve
performance objectives shall not by itself constitute
grounds for Termination for Cause.
Upon notice by GX to Executive that it is terminating Executive
pursuant to a Termination for Cause, the "Termination Date" shall be the date on
which such notice is mailed or hand-delivered, or as otherwise specified in the
notice of termination, to Executive. Upon Termination for Cause, Executive shall
be entitled to the Accrued Obligations (except that there shall be no pro rata
payment of Annual Bonus for the year of termination) and, except as provided
under the terms of the GX benefit plans, shall not be entitled to receive any
further compensation or payments hereunder. All AX and GX Stock Options held by
Executive shall be subject to the provisions of Executive's stock option
agreements and applicable stock option plans.
(c) Termination Other Than For Cause. Executive may be terminated by
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GX at any time and for any (or no) reason, upon the giving of notice by GX to
Executive of termination other than a Termination for Cause (other than by
reason of Executive's death or Disability). In such event, GX may, in the notice
of termination, discharge Executive immediately or as of such future date, not
to exceed one month, as GX may determine to be appropriate. In the event that
Executive is terminated pursuant to this subsection, Executive shall receive (i)
the Accrued Obligations; (ii) a lump-sum
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payment of 2 times the sum of Base Salary plus Annual Bonus (calculated by
assuming that target level performance was attained); (iii) for a period of one
year following the date of such termination (or until such earlier date as
equivalent benefits are provided from other employment), continuation of
benefits provided in accordance with Section Error! Reference source not found.
hereof; (iv) Full Option Vesting and Extended Exercise Rights; (v) Loan
Forgiveness; and (vi) the Gross-Up Payment. If GX terminates Executive under
this Section 7(c) but Executive's employment as CEO of AX is not terminated on
or prior to the date thirty days after the date of such termination by GX, then
(1) AX shall have no obligation in respect of the payments required to be made
to Executive under this Section 7(c) and (2) the AX Employment Agreement shall
thereafter continue in effect in accordance with its terms without giving
further effect to any amendments to such agreement contained herein. If
Executive's employment with AX is terminated within thirty days of the date of
Executive's termination by GX, Executive shall retain all claims against AX
under Section 8(a), 8(b), 8(c) or 8(d), as applicable, of the AX Employment
Agreement; provided that any cash payments finally and irrevocably made by
either GX or AX under this Section 7(c) shall relieve AX of a corresponding
amount of cash payment obligations under such applicable section of the AX
Employment Agreement.
(d) Resignation for Good Reason. The occurrence of any of the
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following events during the Term without his express written consent shall
entitle Executive to resign for Good Reason ("Good Reason Event") during the
Term: (i) any material diminution in the nature or scope of Executive's
authority, powers, functions, duties, positions or responsibilities from those
provided under this Agreement, or the assignment of duties, responsibilities or
reporting relationships that are inconsistent with his then positions or
responsibilities under this Agreement (other than with respect to AX on or after
a Transition Termination); (ii) without Executive's consent, relocation by more
than 50 miles of Executive's office, or of GX's principal executive offices,
from the principal executive office location established pursuant to Section
Error! Reference source not found.(a) hereof; (iii) any material uncured breach
by GX of this Agreement (including any failure to provide compensation when and
as required hereunder, unless cured within 10 business days of such failure);
(iv) failure of any successor of AX or GX to assume in writing all obligations
imposed on the applicable assignor hereunder on or prior to the date of such
succession, unless such assumption occurs by operation of law; (v) failure to
appoint or elect or reelect Executive as GX CEO and Director; or (vi) GX notice
of nonrenewal of this Agreement. For 60 days following the occurrence of a Good
Reason Event, Executive shall have the right to deliver a notice of breach to GX
detailing the specific Good Reason Event that has occurred. In the event that GX
does not cure the breach, if susceptible of cure, within 60 days after receipt
of notice, then Executive shall have 30 days to deliver notice of resignation.
Upon such resignation, Executive shall receive the same payments and benefits as
provided in Section Error! Reference source not found. hereof. If Executive
resigns under this Section 7(d) as a result of the acts or omissions of GX and
not as a result of the acts or omissions of AX, then (1) AX shall have no
obligation in respect of the payments required to be made to Executive under
this Section 7(d) and (2) the AX Employment Agreement shall thereafter continue
in effect in accordance with its terms without giving further effect to any
amendments to such agreement contained herein. Notwithstanding the foregoing, if
Executive's employment with AX is terminated within thirty days of Executive's
resignation from GX, Executive shall retain all claims against AX under
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Section 8(a), 8(b), 8(c) or 8(d), as applicable, of the AX Employment
Agreement; provided that any cash payments finally and irrevocably made by
either GX or AX under this Section 7(d) shall relieve AX of a corresponding
amount of cash payment obligations under such applicable section of the AX
Employment Agreement.
(e) Resignation from Board. Upon termination of Executive's
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employment with GX for any reason, Executive shall resign as of the date of such
termination from the Board and any affiliate board of directors (provided that
Executive shall not be required to resign from the AX Board unless his
employment with AX is terminated).
8. Confidentiality and Proprietary Information.
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Executive shall comply in all respects with the terms and
conditions of the Proprietary Information Agreement annexed hereto as Attachment
"B" hereto and incorporated by reference.
9. Miscellaneous.
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(a) Notices. Any notice or other communications provided for in
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this Agreement shall be in writing and deemed received upon receipt after
delivery by certified mail, return receipt requested, or by hand as follows: (i)
in the case of GX, to the Board of Directors of GX, Attention: Chairman, at GX's
offices at 000 Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx Xxxxx, XX 00000, or at such other
address as shall be communicated in the manner provided herein and (ii) in the
case of Executive, to Executive at GX's offices at Seven Giralda Farms, Madison,
NJ 07940, Attention: Chief Executive Officer, with a simultaneous copy to
Xxxxxxx Xxxxx, Esq. at Xxxxxxx Xxxx & Xxxxxxxxx, 000 Xxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000-0000, or to such other address as shall be communicated in the
manner provided herein. An email copy shall also be provided to Executive at his
regular corporate email address.
(b) Modification/Waiver. No waiver or modification in whole or in
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part of this Agreement, or any term or condition hereof, shall be effective
against any party unless in writing and duly signed by the parties hereto. Any
waiver or any breach of any provision hereof, or of any right or power by any
party on one or more occasions shall not be construed as a waiver of, or a bar
to, the exercise of such right or power on any other occasion or as a waiver of
any subsequent breach.
(c) Severability. Each provision of this Agreement shall be
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interpreted so as to be effective and valid under applicable law, but if any
provision of this Agreement shall be held to be prohibited by or invalid under
applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
of the remaining provisions of this Agreement.
(d) Binding Effect: Successors. This Agreement shall inure to
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the benefit of and shall be binding upon GX and AX and their respective
successors, assigns and legal representatives and Executive, his heirs and legal
representatives. Executive
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may not assign, transfer, or otherwise dispose of this Agreement, or any of
his other rights or obligations hereunder (other than his rights to payments
hereunder, which may be transferred only by will or by the laws of descent and
distribution), without the prior written consent of GX and AX, and any such
attempted assignment, transfer or other disposition without such consent shall
be null and void. GX and AX shall each be entitled to assign its respective
obligations under this Agreement, without the prior written consent of
Executive, (i) in connection with an arm's-length merger or consolidation of
such party with another unaffiliated corporation or (ii) in connection with an
arm's-length sale of all or substantially all of its assets or business
operations to another person or entity, provided that such assignee expressly
assumes all of the rights and obligations of such party hereunder. After any
such assignment, this Agreement shall continue in full force and effect.
(e) Entire Agreement. This Agreement, the AX Employment Agreement, as
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amended in the manner provided herein, and the other agreements referenced
herein, set forth the entire agreement between the parties hereto with respect
to the subject matter hereof, and supersede all other agreements and
understandings, written or oral, between the parties hereto with respect to the
subject matter hereof.
(f) Controlling Law. This Agreement shall be governed by, and
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construed and enforced in accordance with, the laws of the State of New York,
without regard to conflict of laws.
(g) Authority. GX and AX represent that each has obtained all
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approvals, including Board and Compensation Committee approvals, required to
enter into and perform its respective obligations under this Agreement and the
AX Employment Agreement, as amended as provided herein and that no other
agreements would prevent or conflict with GX or AX entering into this Agreement
and amending the AX Employment Agreement as provided herein. Executive accepts
and agrees to the provisions of this Agreement and the amendments of the AX
Employment Agreement set forth herein, agrees that none of the provisions of
this Agreement or obligations imposed upon him hereunder will be treated by him
as a violation thereof, and represents that no other agreements to which he is a
party would prevent or conflict with his entering into this Agreement and
amending the AX Employment Agreement as provided herein.
(h) Non-Solicitation. After the termination or resignation of
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Executive, Executive shall not, either directly or indirectly, expressly or
impliedly, at any time during a period of two years following such termination
or resignation, solicit or encourage in any manner whatsoever (i) the employment
or engagement of, either for his own account or for any other person or entity,
any person who is employed by GX or its affiliates, or (ii) the business of
customers or clients of GX or its affiliates to a business competitive with GX
or its affiliates.
(i) Binding Arbitration. Any controversy arising out of or relating
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to this Agreement or the breach hereof shall be settled by binding arbitration
in accordance with the Employment Dispute Resolution Rules of the American
Arbitration
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Association (with the exception that there will be a panel of three arbitrators
rather than a single arbitrator) and judgment upon the award rendered may be
entered in any court having jurisdiction thereof. Specific performance,
injunctive relief and other remedies at law and equity shall be permitted to
enforce the provisions hereof regarding confidentiality, non-solicitation, the
conversion of AX Stock Options, the grant of GX Stock Options and "Change in
Control." The costs of any such arbitration proceedings shall be borne equally
by GX and Executive. No party shall be entitled to recover attorney's fees or
costs expended in the course of such arbitration or enforcement of the award
rendered thereunder. The location for the arbitration shall be New York City,
New York.
(j) Indemnification. GX shall indemnify Executive to the fullest
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extent permitted by law (including a payment of expenses in advance of final
disposition of a proceeding) as in effect at the time of the subject act or
omission, or by the terms of any indemnification agreement between GX and
Executive, whichever affords the greatest protection to the Executive, and
Executive shall be a named insured under and shall be entitled to the protection
of all insurance policies GX may maintains generally for the benefit of its
senior executive officers and directors (and to the extent GX maintains such an
insurance policy or policies, in accordance with its or their terms to the
maximum extent of the coverage available for any company officer), against all
costs, charges, expenses or liabilities whatsoever incurred or sustained by
Executive (including but not limited to any judgment entered by a court of law)
at the time such costs, charges, expenses or liabilities are incurred or
sustained, in connection with any action, suit or proceeding to which Executive
may be made a party by reason of his being or having been an officer or employee
of GX or AX, or serving as a director, officer or employee of an affiliate of
GX, at the request of GX. Executive's rights under this Section Error! Reference
source not found. shall continue without time limit for so long as he may be
subject to any such liability, whether or not the Term may have ended.
(k) Legal Fees. GX shall reimburse Executive for reasonable legal fees
----------
and costs incurred in the negotiation and preparation of this Agreement, up to a
maximum of $15,000.
(l) Counterparts. This Agreement may be executed in counterparts.
------------
Execution by facsimile shall be binding on the parties.
(m) Mitigation and Offset. Executive shall not be required to mitigate
---------------------
amounts payable under this Agreement by seeking other employment or otherwise,
and there shall be no offset against amounts due Executive under this Agreement
on account of subsequent employment.
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IN WITNESS WHEREOF, GX, AX and Executive have executed this
Agreement as of the day and year first above written.
Global Crossing Ltd.
a Bermuda corporation
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxxxxxx X. Xxxx
----------------------------- --------------------------
Name: Xxxx Xxxxxxx Name: Xxxxxxxx X. Xxxx
Title: Chairman Title: Co-Chairman
Asia Global Crossing Ltd.
a Bermuda corporation
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxxxxxx X. Xxxx
----------------------------- --------------------------
Name: Xxxx Xxxxxxx Name: Xxxxxxxx X. Xxxx
Title: Chairman Title: Co-Chairman
AGREED AND ACCEPTED:
/s/ Xxxx X. Xxxxxx
---------------------------------
Xxxx X. Xxxxxx
12
