EXHIBIT 10.4
January 1, 1997
[NAME]
[ADDRESS1]
[ADDRESS2]
RE: AMENDMENT TO EMPLOYMENT AGREEMENT DATED JANUARY 1, 1997
Dear Mr. [LASTNAME]:
This letter will set forth the terms of an amendment to your Employment
Agreement with U. S. Long Distance Corp. (the "Employer") dated January 1, 1997
(the "Agreement"). Effective January 1, 1997, the Agreement will be amended by
adding the following SECTION 20:
20. A. TERMINATION FOLLOWING CHANGE OF CONTROL. Notwithstanding anything to
the contrary contained herein, should Employee at any time within 12
months of the occurrence of a "change of control" (as defined below)
cease to be an employee of the Company (or its successor), by reason
of (i) termination by the Company (or its successor) other than for
"cause" (following a change of control, "cause" shall be limited to
the conviction of or a plea of NOLO CONTENDERE to the charge of a
felony (which, through lapse of time or otherwise, is not subject to
appeal), or a material breach of fiduciary duty to the Company through
the misappropriation of Company funds or property or (ii) voluntary
termination by Employee for "good reason upon change of control" (as
defined below), then in any such event, (a) the Company shall pay
Employee, within 15 days of the effective date of such termination, a
lump-sum payment equal to (without discounting to present value) one
times his then effective annual base salary, and (b) certain
outstanding stock options held by Employee shall become fully vested
and exercisable pursuant to the Agreement Regarding Vesting of Stock
Options attached hereto as EXHIBIT "A."
As used in this Section, voluntary termination by Employee for "good
reason upon change of control" shall mean (i) removal of Employee from
the office Employee holds on the date of this Agreement, (ii) a
material reduction in Employee's authority or responsibility, (iii)
relocation of the Company's headquarters from its then current
location, (iv) a reduction in Employee's compensation, or (v) the
Company otherwise commits a breach of this Agreement.
As used in this Agreement, a "change of control" shall be deemed to
have occurred if (i)(a) any "Person" (as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), is or becomes a "beneficial owner" (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing more than 30% of the combined
voting power of the Company's then outstanding securities, or (ii) at
any time during the 24-month period after a tender offer, merger,
consolidation, sale of assets or contested election, or any
combination of such transactions, at least a majority of the Board of
Directors of U. S. Long Distance Corp. ("USLD"), the Company's parent
corporation, shall cease to consist of "continuing directors" (meaning
directors of USLD who either were directors at or prior to such
transaction or who subsequently became directors and whose election,
or nomination for election by USLD's stockholders, was approved by a
vote of at least two-thirds of the directors then still in office who
were directors prior to such transaction), or (iii) the stockholders
of USLD approve a merger or consolidation that would result in the
voting securities of USLD outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) at least 60%
of the total voting power represented by the voting securities of USLD
or such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the stockholders of USLD approve a plan of
complete liquidation of USLD or an agreement of sale or disposition by
USLD of all or substantially all of USLD's assets.
The Company shall pay any attorney's fees incurred by Employee in
reasonably seeking to enforce the terms of this Section.
B. EXCLUSIVITY OF TERMINATION PROVISIONS. The termination provisions of
this Agreement regarding the parties' respective obligations in the
event Employee's employment is terminated are intended to be exclusive
and in lieu of any other rights or remedies to which Employee or the
Company may otherwise be entitled at law, in equity or otherwise. It
is also agreed that, although the personnel policies and fringe
benefit programs of the Company may be unilaterally modified from time
to time, the termination provisions of this Agreement are not subject
to modification, whether orally, impliedly or in writing, unless any
such modification is mutually agreed upon and signed by the parties.
All other terms and conditions of the Agreement are hereby ratified and
confirmed in their entirety.
If the foregoing sets forth your agreement and understanding of this Amendment,
please execute in the space provided below.
Very truly yours,
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇
President and
Chief Executive Officer
AGREED TO AND ACCEPTED on
this _____ day of January, 1997:
/s/ EMPLOYEE
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[NAME]
EXHIBIT "A"
AGREEMENT REGARDING VESTING OF STOCK OPTIONS
This Agreement is entered into on January 1, 1997, between [NAME]
("Employee") and U. S. Long Distance Corp., a Delaware corporation (the
"Employer").
WHEREAS, Employee has been granted and may hereafter be granted options
under the U. S. Long Distance Corp. ("USLD") 1990 Employee Stock Option Plan (as
amended from time to time, the "Option Plan") to acquire shares of common stock,
$.01 par value, of USLD;
WHEREAS, the Employer and Employee have executed an amendment to the
existing Employment Agreement dated effective January 1, 1997 (the "Employment
Agreement");
WHEREAS, as contemplated in the Employment Agreement, the parties desire
that options granted to Employee under the Option Plan become fully exercisable
by Employee upon termination of the Employment Agreement under certain
circumstances;
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, notwithstanding any provisions to the contrary
contained in resolutions granting or agreements governing options heretofore or
hereafter granted to Employee under the Option Plan ("Options"), in the event
of termination of the Employment Agreement at the election of the Employer under
Section 20 thereof following a "change of control" (as defined therein), then,
in any such event, immediately prior to the effective date of such termination,
all Options which have not lapsed shall become fully vested and exercisable (if
not already vested and exercisable) by Employee for a period of three months
thereafter (as contemplated in Section 14 of the Option Plan).
IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the date indicated above.
EMPLOYER: U. S. LONG DISTANCE CORP.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇
President and
Chief Executive Officer
EMPLOYEE: /s/ EMPLOYEE
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[NAME]
