EXHIBIT 10.29
EMPLOYMENT AGREEMENT
AGREEMENT, executed on this 13th day of January, 1997 and effective as of
the date hereof between Telscape International, Inc., a Texas corporation (the
"Company"), and Xxxx Xxxxxxx Xxxxx, a resident of Texas (the "Employee").
W I T N E S S E T H:
WHEREAS, the Employee is a highly valued and trusted employee of the
Company; and
WHEREAS, the Company desires to offer the Employee continued employment
upon the terms and conditions set forth herein and the Employee desires to
accept such employment; and
NOW THEREFORE in consideration of the mutual benefits to be derived from
this Agreement, the Company and the Employee hereby agree as follows:
1. TERM OF EMPLOYMENT; OFFICE AND DUTIES.
(a) During the Period of Employment (as hereinafter defined), the
Company, shall employ the Employee with the titles of Executive Vice President,
and Chief Financial Officer and General Council, with the duties and
responsibilities prescribed for such offices in the Bylaws of the Company and
such subsidiaries, and with such additional duties and responsibilities
consistent with such positions as may from time to time be assigned to the
Employee by the Chief Executive Officer of the Company. Employee agrees to
perform such duties and discharge such responsibilities in accordance with the
terms of this Agreement.
(b) During the Period of Employment, the Employee shall devote
substantially all of his working time and attention to the business and affairs
of the Company and its subsidiaries, other than during vacations (which shall be
of a duration that is consistent with the policies of the Company) and periods
of illness or incapacity; provided, however, that nothing in this Agreement
shall preclude the Employee from devoting time required: (i) for serving as a
director, principal or officer of any organization or entity involving no
conflict of interest with the Company; (ii) delivering lectures, fulfilling
speaking engagements or participating in activities of professional associations
including xxxxxxxx of commerce; and (iii) engaging in charitable and community
activities; PROVIDED THAT, such activities do not interfere with the performance
of his duties hereunder and attention to the business and affairs of the
Company.
2. TERM; PERIOD OF EMPLOYMENT
The period of employment hereunder (the "Period of Employment") shall
commence on the date hereof (the "Effective Date") and, unless sooner terminated
pursuant to this Agreement, shall terminate on the third anniversary of the
Effective Date. The Period of Employment may be extended by the written
agreement of the Company and Employee.
3. COMPENSATION AND BENEFITS.
For all services rendered by the Employee in any capacity during the
Period of Employment, including without limitation, services as an executive
officer, director, or member of any committee of the Company or any subsidiary,
affiliate or division thereof, the Employee shall be compensated as follows:
(a) BASE SALARY. The Company shall pay the Employee a fixed salary
("Base Salary") at a rate of Seventy Thousand Dollars (US $70,000) per year. The
Board of Directors will periodically review, at least annually, the Employee's
Base Salary with a view to increasing such Base Salary if, in the judgment of
the Board of Directors, the earnings of the Company or the services of the
Employee merit such an increase. Annual increases in Base Salary, once granted,
shall not be subject to revocation and shall become a part of the Base Salary.
Base Salary will be payable in accordance with the customary payroll practices
of the Company, but in no event less frequently than monthly.
(b) BONUS. The Company may pay the Employee a bonus if, in the
judgment of the Board of Directors, the earnings of the Company or the services
of the Employee merit such bonus.
(c) FRINGE BENEFITS. During the Period of Employment, the Employee
shall be entitled to participate in such fringe benefit, insurance, deferred
compensation and stock option plans or programs of the Company, if any, to the
extent that his position, tenure, salary, age, health and other qualifications
make him eligible to participate, subject to the rules and regulations
applicable thereto. Such additional benefits shall include, but not be limited
to, paid sick leave and individual health insurance, all in accordance with the
policies of the Company. Except as specifically set forth herein, the terms of,
and participation by the Employee in, any such plan or program shall be
determined by the Board of Directors in its sole discretion. In the event of the
Employee's disability, the Employee and his family shall continue to be covered
by all of the Company's life, medical, health and dental plans, at the Company's
expense, for lesser of the term of such disability or the remaining term of the
Period of Employment. In the event of the Employee's death, the Employee's
family shall continue to be covered by all of the Company's medical, health and
dental plans, at the Company's expense, for twenty-four (24) months following
the Employee's death.
(d) WITHHOLDING AND EMPLOYMENT TAX. Payment of all compensation
hereunder shall be subject to customary withholding tax and other employment
taxes and deductions as may be required with respect to compensation paid by an
employer/corporation to an employee.
(e) VACATIONS. Employee shall be entitled to annual vacations in
accordance with the policies of the Company, but in no event less than two weeks
and Employee shall be eligible for such benefit immediately.
4. BUSINESS EXPENSES.
The Company shall pay or reimburse the Employee for all reasonable travel
or other expenses incurred by the Employee in connection with the performance of
his duties under this Agreement, including reimbursement for attending meetings
of the Board of Directors, in accordance with such procedures as the Company may
from time to time establish for senior officers and as required to preserve any
deductions for income taxation purposes to which the Company may be entitled.
5. TERMINATION OF EMPLOYMENT.
Notwithstanding any other provision of this Agreement, the Period of
Employment may be terminated:
(a) By the Company, in the event of the Employee's death, Disability
(as hereinafter defined) or for Cause (as hereinafter defined). For purposes of
this Agreement, "Cause" shall mean Employee's conviction of a crime involving an
act or acts of dishonesty, fraud or moral turpitude by the Employee, which act
or acts constitute a felony and the willful and continued failure to
substantially perform Employee's duties hereunder after receipt of written
notice from the Company specifically setting forth such failure. For purposes of
this Agreement, "Disability" shall mean the inability of Employee, in the
reasonable judgment of a physician appointed by the Board of Directors, to
perform his duties of employment for the Company or any of its subsidiaries
because of any physical or mental disability or incapacity, where such
disability shall exist for an aggregate period of more than 120 days in any
365-day period or for any period of 90 consecutive days. The Company shall by
written notice to the Employee specify the event relied upon for termination
pursuant to this Subsection 5(a), and the Period of Employment hereunder shall
be deemed terminated as of the date of such notice. In the event of any
termination under this Subsection 5(a), the Company shall pay all amounts then
due to the Employee under Section 3(a) of this Agreement, in addition to any
severance payments required by law, and, if such termination was due to Cause,
the Company shall have no further obligations to Employee under this Agreement.
(b) By the Company, for any reason and in its sole and absolute
discretion, provided that in such event the Company shall, in addition to any
severance payments required by law, as liquidated damages or severance pay, or
both, continue to pay to the Employee the Base Salary for a period of one year
after such termination.
(c) By the Employee, (i) if the Company's Board of Directors fails
to elect or reelect the Employee to, or removes the Employee from, any of the
offices referred to in Section 1(a) or (ii) if the Employee is not nominated to
the Company's Board of Directors within twelve (12) months of the date hereof,
or, once elected, is removed from the Board of Directors of the Company other
than for Cause or failure to discharge properly his duties in any such offices
or at the direction of the Company. In the event of any termination under this
Section 5(c), the Company shall, in addition to any severance payments required
by law, as liquidated damages or severance pay, or both, continue to pay to the
Employee the Base Salary for a period of one year after such termination.
(d) During any period in which payments are payable by the Company
to Employee pursuant to Sections 5(b) or 5(c) hereof (such payments being
hereinafter collectively referred to as "Termination Payments"), Employee and
his family shall continue to be covered by the Company's life, medical, health
and death plans. Such coverage shall be at the Company's expense to the same
extent as if Employee were still employed by the Company.
6. NON-COMPETITION.
During the Period of Employment hereunder and for the one year period
thereafter, the Employee shall not, anywhere within the United Mexican States,
the United States of America or anywhere else in the world in which the Company
(or any of its subsidiaries) is then doing business, engageas an individaul, in
activities in competition with the business of the Company, including but not
limited to any aspect of the teleconferencing or telecommunications. In
addition, for one year following the later of the last day of the Period of
Employment or the payment of the last Termination Payment hereunder, the
Employee shall not, within any jurisdiction in which the Company or any
subsidiary of the Company is then doing business, or within a one hundred (100)
mile radius of any such jurisdiction, engage in activities in competition with
the business of the Company or any subsidiary as an individual. Investments in
less than five percent of the outstanding securities of any class of a
publicly-traded company shall not be prohibited by this Section 6. Should the
Company terminate Employee without Cause, then Section 6 shall be null and void.
7. INVENTIONS AND CONFIDENTIAL INFORMATION.
The parties hereto recognize that a major need of the Company is to
preserve its specialized knowledge, trade secrets, and confidential information.
The strength and good will of the Company is derived from the specialized
knowledge, trade secrets, and confidential information generated from experience
with the activities undertaken by the Company and its subsidiaries. The
disclosure of this information and knowledge to competitors would be beneficial
to them and detrimental to the Company, as would the disclosure of information
about the marketing practices, pricing practices, costs, profit margins, design
specifications, analytical techniques, and similar items of the Company and its
subsidiaries. By reason of his being a senior executive of the Company, the
Employee has or will have access to, and has obtained or will obtain,
specialized knowledge, trade secrets and confidential information about the
Company's operations and the operations of its subsidiaries, which operations
extend throughout the United Mexican States. Therefore, the Employee hereby
agrees as follows, recognizing that the Company is relying on these agreements
in entering into this Agreement:
(i) During and after the Period of Employment hereunder the Employee will
maintain as confidential and will not use, disclose to others, or publish
or otherwise make available to any other party any inventions or any
confidential business information about the affairs of the Company and its
subsidiaries, including but not limited to confidential information
concerning their products, methods, product purchasing arrangements and
agreements, product distribution arrangements and agreements, engineering
designs, system designs and standards, analytical techniques, technical
information, customer information, employee information, and other
confidential information acquired by him in the course of his past or
future services for the Company. Employee agrees to hold as the Company's
property all memoranda, books, papers, letters, formulas and other data,
and all copies thereof and therefrom, in any way relating to the Company's
or its subsidiaries' businesses and affairs, whether made by him or
otherwise coming into his possession, and on termination of his
employment, or on demand of the Company, at any time, to deliver the same
to the Company within twelve (12) hours of such termination or demand.
(ii) During the Period of Employment hereunder and for one year following the
last day of the Period of Employment, the Employee will not induce or
otherwise attempt to influence any employee of the Company or its
subsidiaries, to leave such entity's employment (unless the Board of
Directors shall have authorized such employment and the Company shall have
consented thereto in writing).
8. INDEMNIFICATION.
The Company will indemnify the Employee (and his legal representatives) to
the fullest extent permitted by the laws of the state in which the Company is
incorporated, as in effect at the time of the subject act or omission, or the
Certificate of Incorporation and Bylaws of the Company, as in effect at such
time or on the date of this Agreement, whichever affords greater protection to
the Employee, and the Employee shall be entitled to the protection of any
insurance policies the Company may elect to maintain generally for the benefit
of its directors and officers, against all costs, charges and expenses
whatsoever incurred or sustained by him or his legal representative in
connection with any action, suit or proceeding to which he (or his legal
representatives or other successors) may be made a party by reason of his being
or having been a director or officer of the Company or any of its subsidiaries.
9. LITIGATION EXPENSES.
In the event of any litigation or other proceeding between the Company and
the Employee with respect to the subject matter of this Agreement and the
enforcement of the rights hereunder, the Company shall reimburse the Employee
for all of his reasonable costs and expenses relating to such litigation or
other proceeding, including, without limitation, his reasonable attorneys' fees
and expenses, provided that such litigation or proceeding results in:
(i) settlement requiring the Company to make a payment to the Employee, or
(ii) final judgment or order in favor of the Employee.
10. CONSOLIDATION; MERGER; SALE OF ASSETS; CHANGE OF CONTROL
Nothing in this Agreement shall preclude the Company from combining,
consolidating or merging with or into, transferring all or substantially all of
its assets to, or entering into a partnership or joint venture with, another
corporation or other entity, or effecting any other kind of corporate
combination provided that the corporation resulting from or surviving such
combination, consolidation or merger, or to which such assets are transferred,
or such partnership or joint venture assumes this Agreement and all obligations
and undertakings of the Company hereunder. However, if in such event, a change
of control results in either: i) an elimination of Employee from Board of
Directors if elected, or ii) Employee is no longer Chief Financial Officer, the
options granted under the Stock Option Agreement ("Option Agreements") by and
between the Employee and the Company shall immediately vest and become
exercisable in accordance with such Option Agreements. Upon such a
consolidation, merger, transfer of assets or formation of such partnership or
joint venture, this Agreement shall inure to the benefit of, be assumed by, and
be binding upon such resulting or surviving transferee corporation or such
partnership or joint venture, and the term "Company," as used in this Agreement,
shall mean such corporation, partnership or joint venture, or other entity and
this Agreement shall continue in full force and effect and shall entitle the
Employee and his heirs, beneficiaries and representatives to exactly the same
compensation, benefits, perquisites, payments and other rights as would have
been their entitlement had such combination, consolidation, merger, transfer of
assets or formation of such partnership or joint venture not occurred.
11. SURVIVAL OF OBLIGATIONS.
Sections 5, 6, 7, 8, 9 and 10 shall survive the termination for any reason
of this Agreement (whether such termination is by the Company, by the Employee,
upon the expiration of this Agreement or otherwise). Provided, however, that
should the Company terminate the Employee for other than Cause, then Section 6
shall not survive the termination of this Agreement.
12. SEVERABILITY.
In case any one or more of the provisions or part of a provision contained
in this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect in any jurisdiction, such invalidity, illegality or
unenforceability shall be deemed not to affect any other jurisdiction or any
other provision or part of a provision of this Agreement, nor shall such
invalidity, illegality or unenforceability affect the validity, legality or
enforceability of this Agreement or any provision or provisions hereof in any
other jurisdiction; and this Agreement shall be reformed and construed in such
jurisdiction as if such provision or part of a provision held to be invalid or
illegal or unenforceable had never been contained herein and such provision or
part reformed so that it would be valid, legal and enforceable in such
jurisdiction to the maximum extent possible. In furtherance and not in
limitation of the foregoing, the Company and the Employee each intend that the
covenants contained in Sections 6 and 7 shall be deemed to be a series of
separate covenants, one for each state, territory or jurisdiction of the United
Mexican States and the United States of America and any foreign country
referenced therein. If, in any judicial proceeding, a court shall refuse to
enforce any of such separate covenants, then such unenforceable covenants shall
be deemed eliminated from the provisions hereof for the purpose of such
proceedings to the extent necessary to permit the remaining separate covenants
to be enforced in such proceedings. If, in any judicial proceeding, a court
shall refuse to enforce any one or more of such separate covenants because the
total time thereof or the geographic area covered thereby is deemed to be
excessive or unreasonable, then it is the intent of the parties hereto that such
covenants, which would otherwise be unenforceable due to such excessive or
unreasonable period of time or geographic area, be enforced for such lesser
period of time as shall be deemed reasonable and not excessive by such court.
13. ENTIRE AGREEMENT; AMENDMENT.
This Agreement contains the entire agreement between the Company and the
Employee with respect to the subject matter hereof and thereof. This Agreement
may not be amended, waived, changed, modified or discharged except by an
instrument in writing executed by or on behalf of the party against whom
enforcement of any amendment, waiver, change, modification or discharge is
sought. No course of conduct or dealing shall be construed to modify, amend or
otherwise affect any of the provisions hereof.
14. NOTICES.
All notices, request, demands and other communications hereunder shall be
in writing and shall be deemed to have been duly given (i) upon delivery, if
personally delivered, (ii) the next business day, if delivered with all charges
prepaid to a recognized overnight delivery service for next day delivery, or
(iii) five days after mailing, if mailed, postage prepaid, via first class mail,
in each such case as follows:
(a) To the Company: (b) To the Employee:
Telscape International, Ltd Xxxx Xxxxx
c/o. 0000 Xxxxxxxxx Xxxx 0000 Xxxxx Xxxxx
Xxxxxxx XX 00000 Xxxxxxx XX 00000
with an additional copy by like means, and by facsimile, to:
De Xxxxxxx Xxxxxxxxxxx Xxxxx & Xxxxx
0000 X Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attn: Xxxxx X. Xx Xxxxxxx, Esquire
and/or to such other persons and addresses as any party shall have specified in
writing to the other.
15. ASSIGNABILITY.
This Agreement shall not be assignable by either party and shall be
binding upon, and shall inure to the benefit of, the heirs, executors,
administrators, legal representatives, successors and assigns of the parties. In
the event that all or substantially all of the business of the Company is sold
or transferred, then this Agreement shall be binding on the transferee of the
business of the Company whether or not this Agreement is expressly assigned to
the transferee.
16. GOVERNING LAW.
This Agreement shall be governed by and construed under the laws of the
State of Texas in the United States of America.
17. WAIVER AND FURTHER AGREEMENT.
Any waiver of any breach of any terms or conditions of this Agreement
shall not operate as a waiver of any other breach of such terms or conditions or
any other term or condition, nor shall any failure to enforce any provision
hereof operate as a waiver of such provision or of any other provision hereof.
Each of the parties hereto agrees to execute all such further instruments and
documents and to take all such further action as the other party may reasonably
require in order to effectuate the terms and purposes of this Agreement.
18. HEADINGS OF NO EFFECT.
The paragraph headings contained in this Agreement are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
COMPANY:
TELSCAPE INTERNATIONAL, INC.
By:
Name:
Title:
EMPLOYEE:
_________________________________
Xxxx X. Xxxxx
