Exhibit 10.21
AGREEMENT OF EMPLOYMENT
THIS EMPLOYMENT AGREEMENT ("Agreement"), as of April 9, 2000 by and among
INDEPENDENT WIRELESS ONE CORPORATION, a Delaware Corporation ("IWO"), IWO
Holdings Inc., a Delaware Corporation ("Holdings" and together with IWO the
"Corporation") and, XXXXXX X. XXXXXXX, residing at 0000 Xxxxx Xxxxxxxx Xxxx, XX,
Xxxxxxxx, Xxxxxxxxxx 00000, hereinafter called the ("Employee").
RECITALS
WHEREAS, the Corporation desires to induce and secure the employment of the
Employee as Chief Financial Officer and Employee desires to be so employed by
the Corporation, beginning as of May 1, 2000 ("Effective Date").
AGREEMENTS
1. Employment and Term. Subject to the provisions for earlier termination and
extension as hereinafter provided in Paragraph 7 below, the Corporation hereby
employs the Employee and the Employee agrees to serve the Corporation for a term
commencing upon the Effective Date and extending until December 31, 2002.
2. Duties of Employee.
(a) The Employee shall serve as Chief Financial Officer of the Corporation, and
of any subsidiary or affiliated corporation if elected by the appropriate Board
of Directors, and shall perform such duties as are appropriate to such office
and not inconsistent therewith as may be assigned to him by the Chief Executive
Officer of the Corporation.
(b) So long as this Agreement shall continue in effect, the Employee shall
devote substantially his full business time and energies to the business and
affairs of the Corporation, and to any subsidiary or affiliate of the
Corporation as directed by the Corporation, and use his best efforts, skills and
abilities to promote its interests.
3. Compensation.
(a) Basic Salary. The Corporation will pay the Employee during the term hereof
for all services to be rendered hereunder a basic salary at the rate of two
hundred thousand dollars ($200,000) per annum from the Effective Date through
December 31, 2000; two hundred five thousand dollars ($205,000) per annum from
January 1, 2001 through December 31, 2001; and two hundred ten thousand dollars
($210,000) per annum from January 1, 2002 to December 31, 2002. The foregoing
basic salary shall be paid in such regular installments as are applied generally
to salary period payments to other employees of the Corporation, but in no event
less than twice monthly.
(b) Cash Bonus Compensation. As an added inducement for the Employee to use his
best efforts to enhance the business of the Corporation, the Corporation shall
pay to the
Employee, as additional compensation hereunder, an annual cash bonus in the
following amount and subject to the following terms and conditions:
(i) for and in respect of each fiscal year (or partial fiscal year) of the
Corporation during the term of Employee's employment by the Corporation whether
or not such employment is under this Agreement or any extension hereof,
commencing with the portion of the fiscal year beginning January 1, 2000, which
succeeds the Effective Date hereof, amounts, payable as provided below, equal to
up to 100% of the basic compensation ("Annual Bonus") described in subparagraph
(a) above. Such bonus shall be payable pro rata to Employee to the extent, and
only to the extent, that business plan targets (including by way of example
only, such targets as Earnings Before Interest, Taxes, Depreciation and
Amortization ("EBITDA"), revenue, and/or target service levels) and individual
management performance targets (as both such business plan and individual
performance targets have been developed by the Corporation's Chief Executive
Officer and Board of Directors in consultation with Employee and issued within
forty-five (45) days after the commencement of the relevant fiscal year of the
Corporation (or portion thereof) have been exceeded or met by at least 75% of
target with respect to the relevant fiscal year (or portion of the relevant
fiscal year) of the Corporation and not to exceed 100% of the Annual Bonus; and
(ii) Employee must be employed full-time on the last day of the applicable
period for which the cash bonus is paid to receive the bonus.
(c) Other Emoluments and Benefits. The Employee shall be entitled to
participate in all rights and benefits for which he shall be eligible under any
stock option plan, bonus, participation or extra compensation plans, pensions,
dental, vision, life, and disability group insurance or other benefits which the
Corporation may provide for its executive employees generally from time to time
during the term of this Agreement. Employee shall also be entitled to:
(i) A computer and appropriate peripherals, a wireless telephone (tolls and
charges paid), leased vehicle for business use, an allowance of three hundred
dollars ($300.00) per month during the period prior to availability of such
leased vehicle to defray the costs of the use of an automobile for business
purposes only; and
(ii) For the period extending from the Effective Date until the earlier of the
date Employee acquires a new residence in the vicinity of Albany, New York, or
one hundred twenty (120) days after the date hereof, the Corporation will lease
on Employee's behalf an
2
executive residential quarters at a cost no greater than One-Thousand Five
Hundred Dollars ($1,500.00) per month.
(iii) Relocation money of approximately $100,000 pursuant to the Relocation and
Expense Agreement entered into by the Employee and the Corporation as of the
date hereof. Such Agreement is incorporated herein as Exhibit A.
(d) Vacation. Employee shall be entitled annually to 248 hours of time-off
from the Employee Paid Time Off Pool as such computation is customarily
administered by the Corporation. Time-off not used during the calendar year or
partial calendar year in which earned may be carried forward to subsequent
calendar years or partial calendar years ("Carry Forward Time"). However,
Employee may not carry over more than 40 hours of Carry Forward Time in any one
year and may not aggregate more than 160 hours of Carry Forward Time in total.
All time off is subject to approval by the CEO and in no event shall annual
vacation exceed 4 weeks.
(e) Stock Incentive Plan. In addition to the basic compensation and cash bonus
compensation provided herein, Employee shall be entitled during the term of his
employment to participate in the Management Stock Incentive Plan of the
Corporation, dated as of December 20, 1999, and pursuant thereto has been
granted certain options pursuant to a Stock Option Agreement entered into
between the Employee and the Corporation as of the date hereof. Such Agreement
is incorporated herein as Exhibit B.
4. Expenses. The Corporation shall provide Employee with a Corporate credit
card, and further shall pay or reimburse the Employee for all reasonable
traveling and other expenses incurred or paid by the Employee in connection with
the performance of his services under this Agreement upon presentation of
expense statements or vouchers and any such other supporting information in such
form as the Corporation may from time to time request; provided, however, that
the amount available for such traveling and other expenses shall be consistent
with general corporate policy guidelines established by the Corporation.
5. Payment. Expenses, benefits and allowances due Employee hereunder shall be
paid not later than thirty (30) days following Employee's entitlement to same,
which, in the case of expenses, shall commence with the Employee's request for
reimbursement. Employee bonuses shall be paid within forty-five (45) days
following year end.
6. Restrictive Covenants. In consideration of payment to Employee of the
compensation specified in Paragraph 3 above, Employee hereby covenants and
agrees as follows:
(a) Employee shall treat either as trade secrets or as confidential or as
proprietary information of the Corporation (i) any data or information acquired
during the course of or as a result of his employment, which is not otherwise
available to Employee except by reason of his employment, including but not
limited to such items as reports or findings from tests, investigative studies,
consultations or the like, methodology, proposals, systems, programs or
marketing techniques, and strategies developed by but not generally released by
the Corporation or peculiar to the business of any customer or client of the
Corporation and all
3
particularized information relating thereto; (ii) names or lists of the
Corporation's clients or information, data or services made available to such
clients not made public by the Corporation and non-public information relating
to the operating methods or plans or requirements of any customer or client of
the Corporation; and (iii) any other data or information designated either by
the Corporation or by any of its customers or clients as confidential or
proprietary.
(b) All improvements, discoveries, programs, process, innovations, and
inventions, and inventions conceived (whether or not deemed patentable),
devised, made, developed or perfected by Employee during any period of his
employment by the Corporation or any period prior to the effective date hereof
during which Employee was in the service of any entity acquired by the
Corporation or any period prior to the effective date hereof during which
Employee was in the service of any entity acquired by the Corporation and
related in any material way to the business, including development and research
of the Corporation, shall be fully and promptly disclosed to the Corporation and
the same shall be the sole and absolute property of the Corporation. Upon
request of the Corporation, the Employee will execute all documents reasonably
deemed appropriate by the Corporation to secure the foregoing rights and for
obtaining the grants of patents, both domestic and foreign, with respect to such
improvements, discoveries, programs, processes, innovations or inventions and
for vesting title to such patents in the Corporation provided, however, that
Employee shall not be required to incur any costs or legal expenses in
conjunction with the compliance of any such request.
(c) Employee agrees to refrain, except as properly required in the business of
the Corporation, or as authorized in writing by the Corporation, (i) from using
for Employee's own benefit any matters to be treated as trade secrets or as
confidential or proprietary information under Paragraph (a) above; (ii) from
using these matters for the benefit of any other person, firm or corporation;
(iii) from disclosing these matters to any other person, firm or corporation;
and (iv) from authorizing or permitting such disclosure during the term of his
employment or thereafter.
(d) Employee agrees to surrender to the Corporation at any time upon request and
in any event upon termination of employment, except as the Corporation may
otherwise consent in writing, all written documents, sketches, records or
information whether copyrighted or patented or not, or any copies of imitations
thereof, whether made by Employee or not, which embody or contain or describe in
any way those matters to be treated as trade secrets or as confidential or
proprietary information under Paragraph (a) above. The Corporation shall not
unreasonably withhold authorization for Employee to retain any matters covered
by this Paragraph 6, the continued possession of which by Employee will not, in
the Corporation's sole but reasonable, opinion, be detrimental to the best
interest of the Corporation.
(e) Employee agrees, during the term of his employment and for a period of two
(2) years after the termination thereof, whether such termination be voluntary
or not, that the Employee will not, except at the direction of the Corporation,
either directly or indirectly, for himself as a proprietor, principal partner,
director, officer, employee, agent or other representative acquire or attempt to
acquire the business then conducted by the Corporation with any customer of the
Corporation under any contracts existing or proposals submitted on or before the
date of termination of his employment.
4
The term "Customer of the Corporation" for purposes hereof shall mean any
individual or entity which is the ultimate user or recipient of the
Corporation's (or any subsidiary of the Corporation) services and products
whether the same be made available directly to such entity or through an
intermediate purchaser of such services and products.
(f) Employee agrees to refrain, during the term of his employment and for one
(1) year thereafter, from hiring or offering to hire, except with the written
permission of the Corporation, any employee of the Corporation or from enticing
away or in any other manner persuading or attempting to persuade any employee of
the Corporation to discontinue his relationship with the Corporation, provided,
however, that nothing herein shall prohibit Employee from hiring or offering to
hire, any employee of the Corporation where the initial hiring inquiry was
solely initiated by any such employee or a third party without the direction
from Employee.
(g) No provision of this paragraph 6 is intended to limit Employee's right to
use or disclose information which is in the public domain or a matter of common
knowledge, or which is generally known in the industry, or acquired by him from
a third party not prohibited from making such disclosure to him, or which
information was already known to Employee other than by breach of this
Agreement; nor is it intended to limit the Employee's obligation to comply with
lawful subpoenas or other lawful process.
(h) No act or failure to act shall be a waiver of any right conveyed hereunder,
except an express waiver in writing. The rights reserved to the Corporation
under this Paragraph 6 of this Agreement are necessarily of a special, unique,
unusual and extraordinary character, which gives them a peculiar value, the loss
of which cannot reasonably or adequately be compensated for in damages in an
action at law, and the breach by Employee of any of the provisions in this
Paragraph 6 will cause the Corporation irreparable injury. Therefore, in
addition to any other available remedies, the Corporation shall be entitled to
an injunction to restrain any violation of this Agreement by Employee, his
agents, servants or employees and all persons, firms, or corporations acting for
or with him. The obligations of the Employee under the covenants herein
contained shall not cease upon termination of his employment for whatever
reason, except where otherwise limited in time above.
These covenants contained in this Paragraph 6 on the part of the Employee shall
each be construed as an agreement independent of any other provision in this
Agreement, and the existence of any claim or cause of action of Employee against
the Corporation, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Corporation of such covenants. It
is the intention of both parties to make the covenants of this Paragraph 6
binding only to the extent that it may be lawfully done under existing
applicable laws. In the event that any part of any covenant of this Paragraph 6
is determined by a court of law to be overly broad thereby making the covenant
unenforceable, the parties hereto agree, and it is their desire, that such court
shall substitute a reasonable judicially enforceable limitation in place of the
offensive part of the covenant, and that as so modified the covenant shall be as
fully enforceable as set forth herein by the parties themselves in the modified
form.
5
7. Terms and Earlier Termination.
(a) Subject to the provisions for earlier termination as herein provided, the
term of this Agreement shall commence and terminate as specified above.
(b) This Agreement shall terminate prior to the expiration date hereinafter set
forth in the event that the Board of Directors shall determine that the Employee
has become disabled, or the Employee shall be dismissed for cause, as
hereinafter provided:
(i) The Board of Directors of the Corporation may determine that the Employee
has become disabled, for purposes of this Agreement, in the event that the
Employee shall fail, because of illness or incapacity, to render for one hundred
twenty (120) successive days in excess of the number of days provided for in the
Corporation's then applicable sick leave policy or for shorter periods
aggregating one hundred twenty (120) days or more in excess of the number of
days provided for in the Corporation's then applicable sick leave policy during
the term hereof, services of the character contemplated by this Agreement, and
thereupon this Agreement and the employment of the Employee hereunder shall be
deemed to have been terminated as of the end of the calendar month in which such
determination was made. Any termination under this Paragraph 7(b)(i) shall not
be deemed to be a termination "for cause" for any purpose under the Agreement or
under any other contract or arrangement between the Employee and the Corporation
relating to employment services or compensation between them.
(ii) The Board of Directors may dismiss the Employee for cause in the event that
it determines that the Employee has committed: (A) fraud or material dishonesty;
(B) intentional or willful or grossly negligent injury to the Corporation; (C)
criminal conduct in relation to his employment; or (D) continued neglect of his
duties hereunder which continues subsequent to fifteen (15) days written notice
to cure, provided that if a longer cure period is required, Employee shall
diligently pursue such cure; and thereupon, this Agreement shall terminate and
the Employee shall be removed from all positions held by him with the
Corporation and any subsidiary corporation, effective upon the delivery of
notice to the Employee by the Board of Directors that it has made such
determination; any other termination by the Corporation shall be considered
termination without cause for purposes of this Agreement and any other contract
or arrangement between the parties hereto. In the event that the Board of
Directors shall desire to dismiss the Employee based on any determination
referred to in the preceding sentence, such determination shall be effective
only upon the following conditions complied with in the following
6
order: (A) Employee shall be furnished with a written statement specifying in
reasonable detail the actions or events supporting such determination; (B) at
the request of the Employee, there shall be convened a Special Meeting of the
Board of Directors no later than fifteen (15) business days after Employee's
receipt of the notice referred to in (A) above at which meeting the Employee
may, with assistance of counsel or other representation, present evidence to
refute or in mitigation of such actions or events or to establish that the
actions or events have been cured; and (C) within five (5) business days after
the adjournment of such Special Meeting, the Board of Directors shall furnish a
written statement to Employee that, based upon Employee's representations and
upon other relevant evidence, such determination has either been confirmed or
rescinded.
(iii) The Board of Directors may terminate this Agreement and dismiss the
Employee, without cause and for any reason deemed sufficient by the Board of
Directors. In the event that the Board of Directors shall decide to dismiss the
Employee and terminate this Agreement based on any determination referred to in
the preceding sentence, such determination shall be effective as of such date as
shall be designated by notice in writing from the Board of Directors to the
Employee (the "Effective Termination Date"). In the event that this Agreement is
terminated pursuant to this subparagraph (iii), Employee shall be entitled to
payment on the Effective Termination Date of an amount equal to (A) the lesser
of the basic salary due pursuant to paragraph 3(a) to accrue during the
remainder of the initial three-year term of this Agreement or the basic salary
that would be due under paragraph 3(a) for the twelve (12) month period
following the Effective Termination Date; plus (B) such cash bonus compensation
prorated to the Effective Termination Date otherwise due Employee pursuant to
paragraph 3(b); and (C) the benefits to be paid to Employee pursuant to
paragraph 3(c), 3(d) and 3(e) prorated to the Effective Termination Date.
(c) Notwithstanding anything to the contrary contained herein, any termination
of Employee's employment by the Corporation pursuant to the terms of this
paragraph, shall not affect or diminish: (i) any rights accruing to the Employee
under this Agreement prior to the effective date of such termination and in such
event Employee rights to all compensation, including, but not limited to,
Paragraphs 3 and 4 above, shall be calculated and paid for and in respect of any
period prior to such effective date; and (ii) any rights or remedies available
to the Corporation by reason of any breach or threatened breach of the
provisions of Paragraph 7 hereof, the force and effect of which provisions shall
survive the termination of this Agreement, however such termination occurs.
7
(d) In the event Employee gives his notice to terminate prior to the expiration
of the Initial Term, Employee shall be entitled to any rights accruing to the
Employee under this Agreement prior to the effective date of termination and in
such event Employee rights to all compensation shall be calculated and paid for
to such effective date, including but not limited to, his basic salary as
described in 3(a), his emoluments and benefits as described in paragraph 3(c),
any unused vacation as set forth in paragraph 3(d), and any incurred or paid
expenses as set forth in paragraph 4. Additionally, Employee shall be entitled
to any vested Stock Incentive Payments as described in paragraph 3(e).
8. Partial Invalidity. All paragraphs, subparagraphs, and portions of this
Agreement shall be considered as separate and distinct from one another, and if,
for any reason any paragraph, subparagraph or portion of this Agreement shall be
held to be invalid or unenforceable, it is agreed that the same shall not be
held to affect the validity or enforceability of the remaining paragraphs,
subparagraphs or portions of this Agreement.
9. Notice. Any notices, requests, demands or other communications required or
permitted under this Agreement shall be in writing and shall be deemed to have
been given when delivered personally, one (1) day after being sent by recognized
overnight courier service with all charges prepaid or charges to the sender's
account, or three (3) days after being mailed by certified mail, return receipt
requested, addressed to the party being notified at the address of such party
first set above, or at such other address as such party may hereafter have
designated by notice; provided, however, that any notice of change of address
shall not be effective until its receipt by the party to be charged therewith.
Copies of any notices or other communications to the Corporation shall
simultaneously be sent by first class mail to:
Independent Wireless One Corporation 000 Xxxxx Xxxx Xxxxxxxxx
Xxxxxx, Xxx Xxxx 00000
Attention: General Counsel
Notice to Holdings shall be as follows:
c/o Investcorp International Inc. 000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Xxxxxxxxxxx X. Xxxxxxx
With a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP 000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Xxxx X. Xxxxxxxxx, Esq.
8
10. Corporation Defined. The terms "Independent Wireless One Corporation" and
"IWO Holdings, Inc." as used in this Agreement, shall include, respectively, IWO
and Holdings, and its respective successors and/or assigns, any subsidiary
corporation of IWO and Holdings, and any corporation into which or which IWO or
Holdings may be merged or consolidated or to which all, or substantially all, of
their respective businesses and/or assets are transferred.
11. Waiver of Breach. The waiver by either party of a breach of any provision of
this Agreement, shall not operate or be construed as a waiver of any subsequent
breach by the same party.
12. Integration: Entire Agreement. This instrument contains the entire agreement
of the parties with regard to the subject matter hereof and supersedes all prior
oral or written understandings, memoranda or communications with regard to the
terms or conditions of Employee's employment by the Corporation. This Agreement
may not be changed orally, but only by an agreement in writing signed by the
party against whom enforcement of any waiver, change, modification, extension or
discharge is sought.
13. Binding Effect. Except as otherwise provided hereinabove, this contract
shall inure to the benefit of, and be binding upon, the heirs, executors,
administrators, successors and assigns of the parties hereto.
14. Assignment. Corporation may assign all or any portion of Corporation's
rights or delegate all or any portion of Corporation's duties under this
Agreement to any Affiliate or to any entity that acquires all or a substantial
portion of the business of the Corporation and Affiliates. However, any such
assignment or delegation shall not relieve Corporation of its financial
obligations to Employee under this Agreement. Except in conjunction with his
estate planning or in the event of death, Employee may not assign any rights
under this Agreement or delegate any duties under this Agreement.
15. Counterparts. This Agreement may be executed in counterparts, including
facsimile counterparts, all of which taken together shall constitute but one
agreement.
IN WITNESS WHEREOF, IWO and Holdings have caused this Agreement to be signed by
their respective officers hereunto duly authorized, and the Employee has
hereunto set his hand and seal, effective as of the day and year first above
written.
INDEPENDENT WIRELESS ONE CORPORATION
BY: /s/ Xxxxx X. Xxxxxx
-------------------
Name: Xxxxx X. Xxxxxx
Title: President & CEO
IWO HOLDINGS, INC.
BY: /s/ Xxxxx X. Xxxxxx
-------------------
Name: Xxxxx X. Xxxxxx
Title: President & CEO
9
EMPLOYEE
/s/ Xxxxxx X. Xxxxxxx
---------------------
Xxxxxx X. Xxxxxxx
10
Exhibit A
Relocation Expense Agreement
Employee Name: Xxxxxx X. Xxxxxxx Date: April 9, 2000
The terms of this Relocation Agreement are predicated on your acceptance of an
Offer of Employment with Independent Wireless One Corporation (the "Company")
and with full understanding that you will take the necessary steps to relocate
in order to fulfill the responsibilities of a full-time, regular employee.
As part of your offer of employment, the Company agrees to pay and/or reimburse
your relocation expenses, consistent with the terms contained in your Employment
Offer Letter, in the amount of approximately $100,000.
Unless stated otherwise in your Employment Offer Letter, Relocation funds will
be distributed to you as follows:
.. 25% of the agreed upon amount upon your signing the Employment Offer Letter
(and any related attachments) and your commencing work with the Company.
.. 25% after sixty (60) days of employment, if applicable.
.. After 60 days no additional dollars will be advanced directly to you but will
be paid as reimbursement when your relocation bills are submitted. (See
Relocation Guidelines)
In accordance with Internal Revenue Service Regulations, any amount paid to or
on behalf of you (the employee) as reimbursement for relocation expenses, with
the exception of shipping household goods and travel to the new location, etc.
must be included in your gross wages as income and will be subject to
appropriate Federal withholding requirements.
In such cases the Company will gross up your taxable relocation reimbursement
amount by using federal tax rates reflective of your annual base salary without
regard to other income. The gross-up amount will be paid in cash at the end of
the year in which your relocation occurred and will be limited to the lesser of
increased tax liability or the maximum amount stated above.
In consideration of the Company's investment in your future, you agree to the
following terms:
.. If your employment with the Company terminates for any reason prior to
completing three (3) full, consecutive months of active service, you will
immediately refund any and all relocation expense payments or reimbursements
paid to you or on behalf of you to the Company.
.. If your employment with the Company terminates before you complete twelve (12)
full, consecutive months of active employment, but after you complete three (3)
or more full, consecutive months of active service, you will immediately refund
to the Company an amount which is equal to: any and all relocation expense
payments or reimbursements paid to you or on behalf of you by the Company
divided by 12, then multiplied by (12 minus the number of full, consecutive
months of active service with the Company).
.. After you complete twelve (12) full consecutive months of active employment,
you retain the full amount.
.. If any action or proceeding is brought to enforce any provision of this
Agreement by the Company, or the Company is required to refer any matter arising
under this Agreement to an attorney, you agree to pay all costs and expenses of
collection and litigation, together with reasonable attorney's fees.
This agreement does not create any contract of employment between you and the
Company. You or the Company may terminate your employment with the Company at
any time with or without reason or cause.
AGREED TO BY: WITNESSED BY:
/s/ Xxxxxx X. Xxxxxxx /s/ Xxxxx Xxxxxx
-------------------------------- --------------------------------------
Employee's Signature Independent Wireless One Corp. (Rep)
DATE: 4/9/00 DATE: 4/9/00
--------------------------- ---------------------------------
