Exhibit 99.3
SCHEDULE OF
EMPLOYMENT CONTINUATION INCENTIVE AGREEMENTS
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ACC Corp. has executed or will execute Employment Continuation Incentive
Agreements ("Agreements") with a number of its officers. Some officers have
executed Agreements with a one year term, while others have executed Agreements
with a six month term. The provisions of these two Agreements differ only
with respect to the term which mentioned in paragraphs 2, 4, 6, 9 and 13. The
Agreement with a term for one year is attached hereto. The selection of officers
to receive Agreements with a one year term are based on several criteria: (a)
minimum of one year service; (b) performance is judged to be above expectations;
(c) loss of officer introduces high risk to the organization. All other officers
not meeting all three criteria were or will be extended the Agreement with a six
month term./1/ The schedule that follows lists the name and title of each
officer who has executed an Agreement, the type of Agreement executed and the
date when the Agreement was executed.
ONE YEAR AGREEMENTS:
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TITLE NAME DATE EXECUTED
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Chief Operating Officer Xxxxxx X. Xxxxxxxx 9/20/89
Chief Financial Officer Xxxxxxx X. Xxxxx 7/15/92
President USLD Xxxxxxx X. XxXxxxxx 2/24/94
President TelEnterprises Xxxxx Xxxxxxx 8/4/94
President UK Ltd. Xxxxxxxxxxx Xxxxxxx 7/7/95
V.P. Operations TelEnterprises Xxxxx Xxxxxxx 1/1/94
Finance Director UK Ltd. Xxx Xxxxxxxxx 7/7/95
General Counsel UK Ltd. Xxxxxxx Xxxxxx 7/3/95
Commercial Svcs. Director - UK Ltd. Xxx Xxxxxx - Xxx 7/27/92
Corporate General Counsel Xxxxxx Xxxxxx 1/26/94
SIX MONTH AGREEMENTS:
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TITLE NAME DATE EXECUTED
----- ---- -------------
Controller Xxxxxx X. Xxxxxx 10/12/94
V.P. Human Resources Xxxxxx X. Xxxxxx 8/22/94
V.P. Finance - ACC Corp. Xxxx X. Xxxxxx 7/28/92
V.P. Sales & Marketing - USLD Xxxx Xxxxx unexecuted as of this date
V.P. Carrier Sales Tab Xxxxxx 11/10/94
V.P. Finance - USLD Xxxxxxx Xxxxx unexecuted as of this date
V.P. Operations Xxxx Xxxxx unexecuted as of this date
V.P. & General Manager - ANTC Xxxxxxx Xxxxxxxxxx unexecuted as of this date
Controller - TelEnterprises Xxxxxxxx Guest 8/4/94
V.P. Sales - TelEnterprises Xxxxxx XxxXxxxxx 1/96
Corporate Counsel - TelEnterprises Xxxxx Xxxxxx 4/28/94
Director of Marketing Xxxx Xxxx 1/96
Director of Facility Planning Xxx XxXxxx 8/21/92
Director of Engineering & Operations Xxxxxxx Xxxxxx 8/19/92
Assistant Corporate Counsel Xxxxx Xxxx-Xxxxxx 7/23/92
Assistant to the Chairman & CEO Xxx X. Xxxx 7/14/92
Operations Director - UK Ltd. Xxxxx Xxxxxx 4/5/95
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/1/ Further, although there are slight variations to these agreements by
country (i.e., Canada and the United Kingdom), the basic terms of these
agreements are the same as those executed in the United States and attached
hereto.
EMPLOYMENT CONTINUATION
INCENTIVE AGREEMENT
(ONE YEAR)
AGREEMENT made by and between ACC CORP., with its principal executive
offices at 000 Xxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000, and
________________________, residing at
____________________________________________________, ("Employee").
R E C I T A L S:
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WHEREAS, the Employee is either commencing employment or has been a key
employee of ACC Corp. and/or of one or more of its subsidiaries; and
WHEREAS, the business environment in which ACC Corp. and its
subsidiaries operate is an extremely competitive and constantly changing one,
often involving mergers, acquisitions, hostile takeovers and corporate
restructurings that can occur with little notice; and
WHEREAS, in view of this business environment and in view of the
valuable contributions that the Employee makes or will make to the business of
the Company (as defined below), ACC Corp. desires, through this Agreement, to
provide some measure of security to the Employee as an incentive to the Employee
to become or remain a key employee of the Company (as defined below) and to
labor diligently on its behalf;
NOW, THEREFORE, in consideration of the mutual promises contained
herein, and other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:
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1. DEFINITIONS. The following terms shall have the following
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meanings in this Agreement:
(a) "Acquiring Entity" shall mean any entity, whether a corporation,
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partnership, joint venture, etc., that, as a result of a Change In Control,
either directly or indirectly has effective control over the business plans,
direction and operations of ACC Corp. This term shall also include any
subsidiaries or related entities over which the Acquiring Entity has control,
and shall also include any entity that, within one year following a Change In
Control of ACC Corp., acquires control over the entity that acquired control of
ACC Corp.
(b) "Benefits" shall mean any and all employee benefits, both taxable
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and non-taxable, including but not limited to: life, health and dental
insurance; automobile allowance or leased automobile; cellular telephone;
officer's reimbursement fund; relocation reimbursement fund; long distance
calling allowance, payment of professional association dues, fees, and licenses;
401(k) Plan matching contributions, or the equivalent dollar value of each such
employee benefit. If required by the context, Benefits shall also mean the
value or cost to the Company of such Benefits. The term "Benefits" does not
include any amounts deemed Compensation, nor the continuation of any disability,
health, dental or life insurance coverage beyond the terms of the policies for
such insurance as the same may exist on the effective date of an Event of
Termination.
(c) "Change In Control" shall mean a change in control of ACC Corp. of a
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nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of
1934 as in effect on the
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date of this Agreement or, if in the future Item 6(e) is no longer in effect,
any regulations issued by the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934 which serve similar purposes; provided that,
without limitation, a Change In Control shall be deemed to have occurred if and
when: (x) any "person" (as such term is used in Sections 13(d) and 14(d)(2) of
the Securities Exchange Act of 1934), other than the Employee, is or becomes a
beneficial owner, directly or indirectly, of securities of ACC Corp.
representing a majority of the combined voting power of ACC Corp.'s then
outstanding securities (excluding, however, the transfer of any shares
beneficially owned by the Employee); or (y) individuals who were members of the
Board of Directors of ACC Corp. immediately prior to a meeting of the
shareholders of ACC Corp. involving a contest for the election of Directors
shall not constitute a majority of the Board of Directors following such
election. The effective date of any such Change in Control shall be the closing
date of the transaction that results in the Change in Control. The terms of
this subparagraph (c) shall also apply to any change in control of any entity
that acquires control of an Acquiring Entity within one year following the
acquisition by the Acquiring Entity of control of ACC Corp.
(d) "Company" shall mean ACC Corp. and/or any of its subsidiaries and/or
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affiliates as the same may exist from time to time anywhere in the world,
regardless of the laws under which incorporated.
(e) "Compensation" shall mean the Employee's salary, accrued bonuses, if
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any, and any stock options held by or awards granted to Employee under the
Company's
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Employee Long-Term Incentive Plan or other stock option or similar Company plan
in effect from time to time, but shall exclude any Benefits.
(f) "Disability" shall mean the Employee's total inability, due to a
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mental or physical illness, incapacity or injury, to render his/her full-time
services to the Company for any period of 60 consecutive days or, if longer,
such period of time as is necessary for the Employee to be deemed "totally
disabled" within the meaning of any long-term disability insurance provided by
the Company and covering the Employee.
(g) "Event of Termination" shall mean the termination of Employee's
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employment, whether due to a Termination For Cause, a Termination Without Cause,
a Change In Control or a Voluntary Termination of Employment by Employee, such
that Employee is no longer employed by the Company.
(h) "Termination For Cause" shall mean that the Company, in its sole
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discretion, terminates Employee's employment due to Employee's personal
dishonesty (in relation to his/her employment and duties with the Company),
incompetence, willful misconduct, breach of a fiduciary duty involving personal
profit, intentional failure to perform stated duties, willful violation of any
law, rule, regulation or final cease and desist order, the penalty for which
constitutes a felony under applicable law; or any breach of Paragraphs 6 or 7 of
this Agreement. For purposes of this paragraph 1(h), no act or failure to act
on Employee's part shall be considered "intentionally done" or "willfully done"
unless done or omitted to be done by Employee in bad faith and without
reasonable belief that such act or omission was in the best interests of the
Company. Notwithstanding the foregoing, Employee shall not be deemed to have
been Terminated For Cause unless and
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until there shall have been delivered to him/her a copy of a resolution duly
adopted by the affirmative vote of a majority of the entire Board of Directors
of ACC Corp. (or, in the event that Employee is a Director of ACC Corp., then by
the affirmative vote of a majority of the non-employee Directors of ACC Corp.
then in office) at a meeting of the ACC Corp. Board of Directors duly called and
held for that purpose (after reasonable notice to Employee and an opportunity
for Employee, together with his/her counsel, to be heard before the Board),
finding that in the good faith opinion of the Board, Employee was guilty of
conduct set forth in this paragraph 1(h) and specifying the particulars thereof
in reasonable detail.
(i) "Termination Without Cause" shall mean that the Company, in its sole
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discretion, terminates the Employee's employment not for any reason that would
constitute a Termination For Cause, nor as a result of any Change In Control,
nor as a result of a Voluntary Termination of Employment by the Employee.
(j) "Voluntary Termination of Employment by the Employee" shall mean
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that the Employee, at his/her volition, leaves his/her employment with the
Company not under a circumstance involving a Termination Without Cause, a
Termination For Cause, nor a Change In Control.
2. VOLUNTARY TERMINATION OF EMPLOYMENT BY EMPLOYEE. In the event
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of a Voluntary Termination of Employment by the Employee, he/she shall not be
entitled to receive any payments hereunder. Under such circumstances, the
Employee shall only be entitled to receive: (a) his/her accrued but unpaid
salary and any other nonforfeitable Compensation and Benefits accrued as of the
effective date of such Event of Termination; and (b) for the one year period
following the effective date of Employee's Voluntary
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Termination of Employment, Employee will be deemed to be an "employee" of the
Company for purposes of any stock option or similar plans of the Company then in
effect, and any stock options that Employee holds under any such plan(s) on the
effective date of his/her Voluntary Termination of Employment will continue to
vest and be exercisable in accordance with their terms for such one year period.
3. TERMINATION OF EMPLOYMENT FOR CAUSE. In the event that the
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Employee's employment is Terminated For Cause, he/she shall not be entitled to
receive any payments hereunder. Under these circumstances, the Employee shall
only be entitled to receive his/her accrued but unpaid salary and any other
nonforfeitable Compensation and Benefits accrued as of the effective date of
such Event of Termination.
4. TERMINATION OF EMPLOYEE'S EMPLOYMENT WITHOUT CAUSE. In the
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event that the Company terminates Employee's employment Without Cause, the
Employee shall be entitled to receive his/her then-current Compensation and
Benefits for one year following the effective date of such Event of Termination;
provided, however, that the Employee is and at all times hereunder remains in
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compliance with Paragraph 7 hereof. For purposes of this Paragraph 4, the term
"Compensation" shall also include the payment (in a lump sum at the end of such
year or in equal monthly installments over the course of the next succeeding
year, at the Company's election and in either case without interest) of the pro-
rated amount of the bonus, if any, that Employee would receive for the calendar
year in which this Event of Termination occurs as determined under the Company's
Annual Incentive Plan as established by the Executive Compensation Committee of
the Company's Board of Directors in advance for that calendar year; such amount
to be pro-rated by multiplying the
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amount of such bonus for the full year by a fraction the numerator of which is
the number of months worked by the Employee during that calendar year through
the effective date of this Event of Termination and the denominator of which is
12. Such payments shall be made on the Company's normal payroll schedule,
except that at any time during such one year period, Employee may give notice to
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the Company or an Acquiring Entity, as the case may be, requesting payment of
the remaining amount of his/her Compensation and Benefits in a lump sum payment,
which request the Company or the Acquiring Entity may, at their sole discretion,
agree to or reject. If this request is agreed to by the Company or the
Acquiring Entity, as the case may be, then such lump sum payment shall be paid
to Employee within 30 days following receipt of such notice, subject to the
Company's receipt of an executed release from the Employee, substantially in the
form attached as Exhibit A hereto, prior to the payment of any such lump sum
payment. In any event, should Employee commence other employment within such
one year period, he/she shall promptly notify the Company or the Acquiring
Entity of such event and the Company or the Acquiring Entity may at its option,
within 30 days following receipt of such notice, pay the Employee the remaining
amount of his/her Compensation and Benefits in a lump sum payment. If the
Employee's employment is Terminated Without Cause at any time within one year
following a Change in Control, such termination shall automatically be deemed to
be a Termination in the Event of a Change in Control, and the Employee shall be
entitled to all rights set forth in Paragraph 5 hereof. If Employee should
commence other employment with an entity that the Company deems a competitor as
described in subparagraph 6(c) below, then the Company shall have the right to
stop further payment of any and all Compensation and Benefits that may be
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payable to the Employee hereunder. Further, in the event of Employee's
Termination Without Cause, for so long as Employee is receiving payments of
his/her Compensation and Benefits under the terms of this Paragraph 4, Employee
will continue to be deemed an "employee" of the Company in all respects (e.g.,
for life and health insurance, income tax and other such purposes) and any
options that Employee holds on the effective date of his/her Termination Without
Cause under any stock option plan of the Company will continue to vest and be
exercisable in accordance with their terms. At such time as all payments under
this Paragraph cease for whatever reason, Employee will no longer be deemed an
"employee" of the Company for any such purposes.
5. TERMINATION OF EMPLOYEE'S EMPLOYMENT IN THE EVENT OF A CHANGE
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IN CONTROL. If, in connection with preparing for, or within one year following,
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a Change In Control: (i) the Employee's employment with the Company or the
Acquiring Entity is Terminated Without Cause by the Company or the Acquiring
Entity; or (ii) the Employee resigns his/her employment with the Company or with
the Acquiring Entity upon the occurrence of any of the following:
(a) A significant change in the nature or scope of Employee's employment
duties or authority including, but not limited to, without Employee's prior
written consent assigning Employee duties inconsistent with his/her status
within the Company or substantially altering Employee's duties and
responsibilities so as to render his/her position to be of less dignity,
responsibility or scope;
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(b) Employee being required by the Company or the Acquiring Entity, as a
condition of employment, to take up permanent residence outside of or to
spend more than 25% of his/her time in any location that is more than a 50
mile radius from the Rochester, New York metropolitan area (except for
required travel on Company business to an extent substantially consistent
with Employee's customary business travel obligations);
(c) A reduction in Employee's Compensation or Benefits as in effect on
the execution date hereof or as the same may be increased from time to
time, excluding, however, (i) reductions in bonuses paid from year to year
when such bonuses are based upon objective performance criteria (e.g.,
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increases in earnings per share, return on equity, etc.) established in
advance by the Board of Directors or Executive Compensation or comparable
Committee of the Board of ACC Corp. or an Acquiring Entity, as the case may
be; and (ii) proportional across-the-board Compensation or Benefits
reductions similarly affecting all executives and/or key employees of the
Company or the Acquiring Entity, as the case may be; provided, however,
that in no event shall Employee's Compensation be reduced below its current
annual amount as in effect on the execution date hereof without Employee's
prior written consent;
(d) Failure to grant Employee an annual salary increase reasonably
necessary to maintain such salary as comparable to salaries
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of key employees holding positions equivalent to Employee's in the
industry in which the Company's then-principal business activity is
conducted;
(e) Failure by the Company or an Acquiring Entity, as the case may be,
to continue in effect any compensation plan, program or arrangement in
which Employee then participates unless an equitable arrangement reasonably
acceptable to Employee and embodied in an ongoing substitute or alternative
plan, program or arrangement has been made with respect to such plan, or
the failure to continue Employee's participation therein;
(f) Any material reduction by the Company or an Acquiring Entity, as the
case may be, of any of the Benefits enjoyed by Employee under any of the
Company's pension, retirement, profit sharing, savings, life insurance,
medical, health and accident, disability or other employee benefit plans,
programs or arrangements as in effect from time to time, the taking of any
action by the Company or an Acquiring Entity, as the case may be, that
would directly or indirectly materially reduce any of such Benefits or
deprive Employee of any such Benefits, or the failure by the Company or an
Acquiring Entity, as the case may be, to provide Employee with the number
of paid vacation days to which he/she is entitled on the basis of years of
service with the Company in accordance with its normal vacation policy;
provided, however, that this subparagraph shall not apply to any
proportional across-the-board reduction or action similarly affecting all
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executives and/or key employees of the Company or an Acquiring Entity, as
the case may be;
(g) Failure of the Company to obtain a satisfactory agreement from any
Acquiring Entity to assume and agree to perform this Agreement;
then the Employee shall be entitled to receive his/her then-current Compensation
and Benefits as were in effect immediately prior to any such Change In Control
for one year following the effective date of such resignation or Termination
Without Cause; provided, however, that the Employee is and at all times
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hereunder remains in compliance with Paragraph 7 hereof. For purposes of this
Paragraph 5, the term "Compensation" shall also include the payment (in a lump
sum by the end of such year or in equal monthly installments over the course of
the next succeeding year, at Employee's election and in either case without
interest) of the amount of the bonus that Employee would receive for the full
calendar year in which this Event of Termination occurs based on the "Maximum"
amount of such bonus as determined under the Company's Annual Incentive Plan as
established by the Executive Compensation Committee of the Company's Board of
Directors in advance for that calendar year. Such payments shall be made on the
normal payroll schedule of the Company or the Acquiring Entity, as the case may
be, except that at any time during such one year period, Employee shall have the
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right, upon notice to the Company or an Acquiring Entity, as the case may be, to
elect to be paid the remaining amount of his/her Compensation and Benefits in a
lump sum payment, which the Company or the Acquiring Entity must then pay to
Employee within 30 days following receipt of such notice, subject to receipt by
the Company or the Acquiring
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Entity of an executed release from the Employee, substantially in the form
attached as Exhibit A hereto, prior to the payment of such lump sum payment. In
no event shall the compensation to which the Employee is entitled under this
Paragraph be less than the greater of (i) Employee's then-current Compensation
and Benefits as were in effect immediately prior to the effective date of such
resignation or Termination Without Cause, or (ii) Employee's then-current
Compensation and Benefits as were in effect immediately prior to the date of the
Change In Control. Additionally, Employee shall be entitled to receive the same
treatment with respect to any options that he/she may hold under the ACC Corp.
Employee Long- Term Incentive Plan at the time that such a Change In Control
occurs as that accorded to other similarly situated key employees of the Company
regardless of whether they remain employees of the Company or the Acquiring
Entity or are deemed to be Terminated due to a Change In Control.
6. COVENANT NOT TO COMPETE. Employee hereby covenants and agrees
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that, while employed by the Company during the term of this Agreement, and for
one year following a Termination For Cause or a Voluntary Termination of
Employment by the Employee:
(a) He/she will not, for himself/herself or on behalf of any other
person, firm, partnership or corporation call upon any customer of the Company
for the purpose of soliciting or providing to such customer any products or
services which are the same as or substantially similar to those provided to
customers by the Company. For purposes of this Agreement, "Customers of the
Company" shall include, but not be limited to, all customers
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contacted or solicited by the Company or the Employee within twelve months prior
to any termination of this Agreement;
(b) Employee will not, directly or through another person or entity, for
himself/herself or on behalf of any other person, firm, partnership or
corporation, directly or indirectly, seek to persuade any director, officer, or
employee of the Company to discontinue that individual's status or employment
with the Company; and
(c) Employee will not, directly or indirectly, alone or as an employee,
independent contractor of any type, partner, officer, director, creditor,
substantial (i.e., 5% or greater) stockholder or holder of any option or right
to become a substantial stockholder in any entity or organization, engage (i)
within the Company's principal geographic area(s) of operation or (ii) in
substantial and direct competition with any other business operation actively
conducted by the Company, in any business pertaining to the sale, distribution,
manufacture, marketing, production or provision of products or services similar
to or in competition with any products or services produced, designed,
manufactured, sold, distributed or rendered, as the case may be, by the Company;
nor for the same period of time, within the same areas and under the same
conditions as previously set forth, shall the Employee advance credit, lend
money, furnish quarters or give advice, directly or indirectly, to any person,
corporation or business entity of any kind (other than the Company) which is
engaged in any such business or operation, nor shall he/she, directly or
indirectly, ship or cause to be shipped or have any part in the shipping of such
products to any point within said areas for the purposes of resale; provided,
however, that nothing contained in this paragraph shall prevent the Employee
from investing in corporate securities which are traded on a
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recognized stock exchange. It shall not be a breach or a threat of a breach of
subparagraphs 6(b) or 6(c) of this Agreement for Employee to explore or seek
employment, including employment with a business of a type described in this
subparagraph, for him or herself.
(d) If any of the restrictions on competitive activities contained in
this Paragraph 6 shall for any reason be held by a court of competent
jurisdiction to be excessively broad as to duration, geographical scope,
activity or subject, such restrictions shall be construed so as to thereafter be
limited or reduced to be enforceable to the extent compatible with applicable
law as it shall then exist; it being understood that by the execution of this
Agreement the parties hereto regard such restrictions as reasonable and
compatible with their respective rights and expectations.
(e) Additionally, if any conduct prohibited by this Paragraph 6 is
approved by ACC Corp.'s Board of Directors, then such conduct shall not
constitute a breach of this Agreement.
7. TRADE SECRETS; NON DISPARAGEMENT. Except as may be required
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by his/her employment with the Company, the Employee will not at any time or in
any manner, directly or indirectly, divulge, disclose or communicate to any
person, firm, corporation, organization or entity any information concerning
matters affecting or relating to the services, marketing, contractual
relationships, long range plans, products, processes, formulas, inventions,
discoveries, devices or other business of the Company or of its customers. The
Employee will likewise hold inviolate and keep secret all knowledge or
information acquired by him/her concerning the names of the Company's customers,
their addresses, the prices the Company obtains or has obtained from them for
its goods or
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services, all knowledge or information acquired by him/her concerning the
products, formulas, processes, methods of manufacture and distribution and all
other trade secrets of such customers. In addition, the Employee shall make no
disclosure, directly or indirectly, of any financial information, contractual
relationships, policies, past or contemplated future actions or policies of the
Company, personnel matters, marketing or sales data, technical data or
specifications and written or oral communications of any sort of the Company or
any of its customers which have not previously been disclosed to the general
public with the Company's consent or without first obtaining the consent of the
Company for such disclosure. Upon the occurrence of any Event of Termination,
the Employee or his/her representatives shall immediately deliver to the Company
all notes, notebooks, letters, papers, drawings, memos, communications,
blueprints or other writings or data relating to the business of the Company or
its customers. Additionally, Employee shall not in any way publicly disparage
the Company at any time or he/she shall not be entitled to receive payment of
any further Compensation and Benefits otherwise payable hereunder. Likewise,
neither the Company nor any Acquiring Entity shall in any way publicly disparage
the Employee at any time. (For purposes of this Agreement, however, the
commencement of any legal proceedings involving matters such as Employee's
performance, conduct, etc., shall not constitute "disparagement.")
8. INJUNCTIVE RELIEF.
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(a) Because the Employee shall acquire by reason of his/her employment
and association with the Company an extensive knowledge of the Company's trade
secrets, customers, procedures, and other confidential information, the parties
hereto recognize that
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in the event of a breach or threat of breach by the Employee of the terms and
provisions contained in Paragraphs 6 or 7 hereof, compensation alone to the
Company would not be a adequate remedy for a breach of those terms and
provisions. Therefore, it is agreed that in the event of a breach or threat of a
breach of the provisions of Paragraphs 6 or 7 by the Employee, the Company shall
be entitled, in addition to (i) terminating further payment of any Compensation
and Benefits that may be payable to the Employee hereunder and (ii) provable
damages, to an immediate injunction from any court of competent jurisdiction
restraining the Employee from committing or continuing to commit a breach of
such provisions without the showing or proving of actual damages. Any
preliminary injunction or restraining order shall continue in full force and
effect until any and all disputes between the parties regarding this Agreement
have been finally resolved on the merits by settlement or by a court of law.
(b) In the event of a breach or threat of a breach of the provisions of
Paragraphs 6 or 7 by the Employee, the Company can, upon ten days' advance
notice to Employee, terminate further payment of any and all Compensation and
Benefits that may be payable to the Employee hereunder, regardless of whether
the Company seeks or obtains injunctive relief under subparagraph 8(a) above.
9. SPECIAL PROVISIONS IN EVENT OF DISABILITY OR DEATH.
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(a) During the term hereof, in the event that the Employee becomes
Disabled as defined in this Agreement, but for meeting the requirement that such
a condition persist for a minimum of 60 consecutive days, then the Company
agrees that it will not, except in a situation constituting a Termination For
Cause, terminate the Employee's
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employment or otherwise act so as to deprive the Employee of his/her eligibility
to receive benefits under any Company-provided disability insurance policy. In
all such circumstances, however, the Company retains the right to Terminate the
Employee For Cause, at any time.
(b) If the Employee is Terminated Without Cause after he/she begins
receiving disability insurance payments under any Company-provided disability
insurance policy, then he/she shall also be entitled to receive the one year of
Compensation and Benefits payable in the event of a Termination Without Cause,
limited, however, to the net amount, if any, by which such termination payments,
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on a monthly basis, exceed the monthly benefits payable to the Employee under
such disability insurance policy.
(c) In the event that the Employee is Terminated Without Cause while
Disabled as described in subparagraph (b) above, or in the event that the
Employee dies during the term hereof, then the Employee or his/her estate, as
the case may be, shall be entitled to the following benefit. Upon the
occurrence of either such event, all unexercised stock options that the Employee
may hold on that date under ACC Corp.'s Employee Long-Term Incentive Plan shall
automatically be deemed fully exercisable for a period of one year following the
occurrence of such event, subject, however, to the original term of the option
grant(s), if shorter (the "Exercisability Period"). If at any time or from time
to time during this Exercisability Period the Employee or his/her estate, as the
case may be, desires to exercise any of such stock options, then he/she or
his/her estate shall so notify ACC Corp., stating specifically the number of
options being exercised, and shall comply with the other requirements of such
Plan in effecting such exercise(s).
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(d) The provisions of this Paragraph 9 shall not apply, except as
provided above in this Paragraph 9, in the event that any Event of Termination
under this Agreement shall first occur. Additionally, the Employee shall only
be entitled to receive the Benefits provided by this Paragraph 9 if he/she is
and at all times hereunder remains in compliance with Paragraphs 6 and 7 hereof.
10. SUPERSEDING OF OTHER OUTSTANDING EMPLOYMENT OR CONTINUATION
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AGREEMENTS. Upon its execution, this Agreement shall be in full force and
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effect and shall automatically supersede any prior employment agreements or
prior Employment Continuation Incentive Agreements then in effect between the
Company and the Employee. Each party hereto also hereby waives and releases any
claims it may have against the other arising under any such agreement that is
superseded hereby. However, if the Employee is a party to an Indemnification
Agreement with ACC Corp., that agreement is unaffected by this Paragraph and
remains in full force and effect in accordance with its terms.
11. TERM. The term of this Agreement shall begin on the later to
----
occur of the date of execution hereof or the date on which the Employee
commences his/her full-time employment with the Company (the "Effective Date")
and shall terminate on the last day of the calendar month which is twelve
calendar months following the month in which the Effective Date falls, unless
further extended as follows: Commencing on the last day of the calendar month
next following the month in which the Effective Date falls, and on the last day
of each succeeding calendar month thereafter, the term of this Agreement shall
automatically be extended, without further action by either party hereto, for
one additional month unless one party provides the other with at least 30 days
notice that it does not wish to
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extend the term of this Agreement. In the event that such termination notice is
given, this Agreement shall then terminate on the last day of the calendar month
that is twelve calendar months following the date such notice is effective. The
undersigned Employee who is a party to this Agreement shall have the sole
discretion to deem a termination of this Agreement by the Company or an
Acquiring Entity, as the case may be, to constitute a Termination Without Cause
hereunder, unless all such Agreements with all key employees are collectively
and simultaneously terminated. No rights to receive any Compensation or
Benefits accrued under this Agreement shall be extinguished by its termination.
12. AUTOMATIC RESIGNATION. By signing this Agreement, the
---------------------
Employee specifically agrees that without further action on the part of either
party hereto, upon the occurrence of any Event of Termination hereunder, the
Employee shall automatically be deemed to have resigned as an officer and
director of ACC Corp. and all of its subsidiaries and affiliates.
13. SURVIVAL. The provisions of Paragraph 6, Covenant Not To
-------- ---------------
Compete, shall survive for one year following any Termination For Cause or
-------
Voluntary Termination of Employment by the Employee; the provisions of Paragraph
7, Trade Secrets, shall indefinitely survive the termination of this Agreement,
-------------
and the provisions of Paragraphs 8, Injunctive Relief, and 15, General Terms,
----------------- -------------
shall survive the termination of this Agreement for so long as necessary to
enable the Company to enforce any of the provisions of Paragraphs 6, 7 or 8
hereof.
14. BASE SALARY AND BENEFITS. During the term of this Agreement,
------------------------
the Employee's Compensation shall not be reduced, nor shall the Employee's
Company-provided
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Benefits be reduced, except as part of a Company-wide proportional reduction of
Compensation or of such Benefits for all key employees of the Company.
15. GENERAL TERMS.
-------------
(a) Notices. Any notice required or desired to be given hereunder shall
-------
be in writing and shall be deemed to have been duly given (i) upon hand
delivery, or (ii) on the third day following delivery to the U.S. Postal Service
as certified mail, return receipt requested and postage prepaid, or (iii) on the
first day following delivery to a recognized overnight courier service, fee
prepaid, return receipt or other confirmation of delivery requested. Any such
notice shall be delivered or directed to a party at its address previously set
forth in this Agreement or to such other address as a party may specify by
notice given to the other party hereto in accordance with the provisions of this
paragraph.
(b) Binding Effect. This Agreement and the rights and obligations
--------------
contained herein shall be binding upon and inure to the benefit of the Company,
its successors and assigns, including any Acquiring Entity, and upon the
Employee, his/her legal representatives, heirs and distributees.
(c) Modifications; Waiver. Any modification or waiver of this Agreement
---------------------
must be in writing and signed by both parties to be effective. No waiver of any
breach or condition of this Agreement shall be deemed to be a waiver of any
other or subsequent breach or condition, whether of like or different nature.
No course of dealing between the parties hereto will be deemed effective to
modify, amend or discharge any part of this Agreement or the rights or
obligations of either party hereunder.
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(d) Entire Agreement. This Agreement contains the entire understanding
----------------
between the parties hereto and supersedes any prior understanding, memoranda or
other written or oral agreements between them respecting the within subject
matter. There are no representations, agreements, arrangements or
understandings, oral or written, between the parties relating to the subject
matter of this Agreement which are not fully expressed herein.
(e) Partial Invalidity. The invalidity or unenforceability of any
------------------
particular provision of this Agreement shall not affect the other provisions
hereof and this Agreement shall be construed in all respects as if such invalid
or unenforceable provision were omitted.
(f) Applicable Law. This Agreement shall be construed and enforced in
--------------
accordance with the laws of the State of New York applicable to contracts made
and to be performed wholly within New York State, without giving effect to
conflict of laws principles.
(g) Jurisdiction and Venue. In the event that any legal proceedings are
----------------------
commenced in any court with respect to any matter arising under this Agreement,
the parties hereto specifically consent and agree that the courts of the State
of New York and/or the Federal Courts located in the State of New York shall
have jurisdiction over each of the parties hereto and over the subject matter of
any such proceedings, and the venue of any such action shall be in Monroe
County, New York and/or the U.S. District Court for the Western District of New
York.
(h) Headings. The headings contained in this Agreement are inserted for
--------
convenience only and do not constitute a part of this Agreement.
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(i) Counterparts. This Agreement may be executed in more than one
------------
counterpart, each one of which will be deemed an original and all of which shall
constitute one and the same instrument.
(j) Assignment. The Employee may not assign any of his/her rights,
----------
duties or obligations hereunder without the prior written consent of ACC Corp.
However, ACC Corp. may assign any of its rights, duties or obligations hereunder
to any of its subsidiaries or affiliates from time to time in its sole
discretion.
(k) Remedies. All rights and remedies of the Company or the Employee,
--------
whether provided for herein or by operation of law, are cumulative and may be
exercised singularly or concurrently, and the exercise of any such remedy shall
not be deemed an election of remedies so as to preclude the election of any
other remedy.
(l) Named Fiduciary. The Board of Directors of ACC Corp. or of an
---------------
Acquiring Entity, as the case may be, is hereby designated as the named
fiduciary ("Named Fiduciary") under this Agreement. The Named Fiduciary shall
have authority to operate and administer this Agreement, and it shall be
responsible for establishing and carrying out a funding policy, if any, and
method consistent with the objectives of this Agreement.
(m) Claims Procedure. The Named Fiduciary shall make all determinations
----------------
regarding disputes between the Company or the Acquiring Entity, as the case may
be, and the Employee as to the Employee's rights under this Agreement. Any such
determination by the Named Fiduciary shall be stated in writing and delivered or
mailed to the Employee or his/her estate, as the case may be, within 30 days
following the Company or the Acquiring Entity becoming aware of such dispute.
This communication shall set forth the specific
- 23 -
reason(s) for the determination, written to the best of the Named Fiduciary's
ability in a manner that can be understood without legal or actuarial counsel.
In addition, the Named Fiduciary shall afford a reasonable opportunity to the
Employee or his/her estate, as the case may be, for a full and fair review of
the determination. If Employee or his/her estate disagrees with the
determination, or any part thereof, or if a determination is not received by the
Employee or his/her estate within the 30 day period set forth above, then
Employee or his/her estate may seek judicial relief.
(n) Disputes. Notwithstanding anything to the contrary contained
--------
herein, in the event of a dispute over Employee's entitlement to or level of
Compensation and/or Benefits under this Agreement, the Company or the Acquiring
Entity, as the case may be, shall be required to commence and continue providing
to the Employee until final resolution of such dispute all Compensation and
Benefits contemplated by Paragraph 5 hereof as if there were no dispute;
provided, however, that Employee is and at all times hereunder remains in
--------
compliance with Paragraph 7 hereof. Neither the Company nor the Acquiring
Entity shall have any right to require Employee or his/her estate, as the case
may be, to repay or reimburse the Company or the Acquiring Entity for any
Compensation or Benefits received by the Employee.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of ___________________, 199_.
- 24 -
EMPLOYEE: ACC CORP.
_______________________________ By: __________________
Name
Title: _______________
- 25 -
EXHIBIT A
[Date]
[Name and Address
of Employee]
Dear_________________:
You and ACC Corp. (the "Company") are parties to an Employment
Continuation Incentive Agreement ("ECIA") dated ___________, 199_. You have
requested a lump-sum payment of all remaining Compensation and Benefits (as
those terms are defined in your ECIA) payable to you under the terms of your
ECIA, pursuant to either Paragraph 4 or Paragraph 5 thereof. In consideration
for the receipt of such lump-sum payment from the Company, you hereby agree to
the following:
1) This Agreement is intended to settle fully and finally all
claims, controversies, disputes and other matters between you and the Company.
Accordingly, as a material inducement to the Company to enter into this
Agreement and in consideration for the above lump-sum payment, you agree to
forever release, acquit and discharge the Company, and its employees, officers,
representatives, attorneys, directors and shareholders and their predecessors,
successors and assigns from and against any and all charges, complaints, claims,
liabilities, obligations, promises, agreements, controversies, damages, actions,
causes of action, suits, rights, demands, costs, losses, debts and expenses of
any nature whatsoever, known or unknown, suspected or unsuspected and all claims
for attorney's fees, costs, disbursements, and expert witness fees which you now
have, own or hold or claim to have, own or hold or which you owned or claimed to
have, own or hold, including, but not limited to those relating to or arising
out of:
(a) your employment with the Company;
(b) your termination of employment with the Company;
(c) claims relating to wages, payments and benefits except as set
forth herein;
(d) the New York Labor Law, the New York State Human Rights Law, the
New York State Lawful Activities Act, Title VII of the Civil
Rights Act of 1964, Title IX of the Civil Rights Act of 1964, the
Civil Rights Act of 1991, the Equal Pay Act, the Employee
Retirement Income Security Act of 1974, the Age Discrimination in
Employment Act of 1967, as amended, the Older Workers Benefit
Protection Act of 1990, the Rehabilitation Act of 1973, the Fair
Labor Standards Act, the
- 26 -
Occupational Safety and Health Act, the Americans with
Disabilities Act, Federal Executive Order 11246 and all
amendments thereto, the Family and Medical Leave Act, New York
Civil Rights Law (S)(S) 70-a, and all regulations pertaining to
all such laws;
(e) any other federal, state or local law, rule or regulation; and
(f) all tort claims and all claims of wrongful or unjust termination,
defamation, prima facia tort, breach of or interference with
contract, promissory estoppel, intentional infliction of
emotional distress or breach of any express or implied covenant
of good faith and fair dealings.
You agree that the Company shall not have any obligation to you other than as
set forth in your ECIA for any other monies or benefits including, but not
limited to, salary, benefits, bonus, or vacation or any obligation set forth in
any agreement of employment or other agreement with the Company, whether such
agreement may be express or implied.
2. This Agreement shall not in any way be construed as an
admission by the Company that it or its officers, directors or employees have
acted wrongfully with respect to you or that you have any rights whatsoever
against the Company or its officers, directors or employees. This Agreement
shall not in any way be construed as an admission by you of any wrongdoing.
3. If you breach this Agreement, you acknowledge that all monies
to be paid by the Company hereunder shall immediately cease, and you shall
immediately return all monies paid pursuant to this Agreement and your ECIA.
These rights are in addition to all other rights or remedies provided to the
Company in law or in equity by reason of your breach.
4. You are hereby advised of your right to consult with an
attorney before signing this Agreement and acknowledge that you have been given
the opportunity to consult with an attorney before signing it. Further, you
acknowledge that, as this Agreement was an Exhibit to your ECIA at the time you
signed your ECIA, you have had a draft of this Agreement for more than 21 days
to review it and consider its terms. Additionally, you understand that you can
revoke this Agreement at any time within seven days following your execution of
it, by written revocation notice to the Company sent certified mail, return
receipt requested. Therefore, you understand and agree that the Company will
not make any payment of the lump-sum you have hereby requested until 28 days
have passed from the date the Company receives this Agreement signed by you.
- 27 -
Your signature below indicates your acceptance of this Agreement and
shall cause this Agreement to be binding upon you, your heirs, representatives
and assigns. Your signature shall also signify that you have read and
understand the Agreement, and that you either have reviewed it with your
attorney or have elected not to do so.
Very truly yours,
ACC Corp.
By: ____________________
Title: _________________
Accepted and Agreed to on this
__________ day of __________________________________, 199_
_________________________
Employee
