Exhibit (10)(w)
AGREEMENT REGARDING SPECIAL COMPENSATION
AND POST EMPLOYMENT RESTRICTIVE COVENANTS
THIS AGREEMENT made this 9th day of November, 1993, by and between
SPRINT/UNITED MANAGEMENT COMPANY, a Kansas corporation and subsidiary of Sprint
Corporation ("Employer"), and XXXX X.
XXXXXX ("Executive").
W I T N E S S E T H:
WHEREAS, Employer and its parent and affiliates are engaged
in the telecommunications business;
WHEREAS, Executive has expertise, experience and capability
in the business of Employer and the telecommunications business
in general;
WHEREAS, Executive has been, and/or now is serving Employer
as Senior Vice President, Staff Operations;
WHEREAS, Employer desires to enter into this Agreement to provide severance
and other benefits for Executive and obtain Executive's agreements regarding
confidentiality and post- employment restrictive covenants for Employer; and
WHEREAS, Executive is willing to provide such agreements to Employer.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which consideration is mutually acknowledged by the parties, it
is hereby agreed as follows:
1. Recitals.
The recitals hereinbefore set forth constitute an integral part of this
Agreement, evidencing the intent of the parties in executing this Agreement, and
describing the circumstances surrounding its execution. Said recitals are by
express reference made a part of the covenants hereof, and this Agreement shall
be construed in light thereof.
2. Duties and Responsibilities.
The duties and responsibilities of Executive are and shall continue to be
of an executive nature as shall be required by Employer in the conduct of its
business. Executive's powers and authority shall include all those presently
delegated to him or such other duties and responsibilities as from time to time
may be assigned to him. Executive recognizes, that during his employment
hereunder, he owes an undivided duty of loyalty to Employer, and agrees to
devote his entire business time and attention to the performance of said duties
and responsibilities and to use his best efforts to promote and develop the
business of Employer.
3. Employment Term.
Executive's employment may be terminated by either party in accordance with
Sections 5, 6, 7, or 8 herein.
4. Compensation and Benefits.
During employment, Executive shall be entitled to receive a base annual
salary, shall be reimbursed for reasonable expenses incurred and accounted for
in accordance with the policies and procedures of Employer, and shall be
entitled to vacation pay and other benefits applicable to employees generally,
each as may from time to time be established, amended or terminated. In
addition, upon execution of this Agreement, Executive shall be awarded five
thousand (5,000) shares of restricted stock as set forth in a restricted stock
agreement of even date herewith, attached hereto and incorporated herein (the
"Restricted Stock Agreement"), shall be entitled to the Special Compensation set
forth in Section 6 hereof in accordance with the terms of this Agreement, and
shall be entitled, subject to approval of the Organization and Compensation
Committee, to participation in the Key Management Benefit Plan in accordance
with the terms of said plan.
5. Termination by Employer: Special Compensation.
At any time, Employer may terminate Executive's employment for any reason. If
Executive's termination is other than pursuant to Section 6, Executive shall,
subject to the other provisions of this Section 5, be entitled to the following
Special Compensation (as that term is defined in this Section 5) in lieu of any
benefits available under any and all Employer separation plans or policies. If
Executive's termination is pursuant to Sections 5, 6 or 7, Executive's
obligations under Sections 11, 12, 13, and 14 hereof shall continue.
For purposes of this Agreement, "Special Compensation" shall consist of :
(a) to continue to receive for a period of eighteen (18) months from the
date of termination (the "Severance Period") biweekly compensation at the
rate equal to the biweekly amount of his base annual salary in effect at
the date of termination of employment;
(b) to receive a bonus, based on actual performance results, up to the
target amount, under the Management Incentive Plan ("MIP") throughout the
Severance Period provided that the amount, if any, payable under such Plan
for the award period including the last day of the Severance Period shall
be pro rated based upon the number of months of the Severance Period that
fall within the award period and the total number of months in such award
period;
(c) to receive an award under the Long Term Incentive Plan, pro rated
based on the Executive's last day worked, exclusive of any Severance
Period, determined in accordance with the terms of said Plan;
(d) acceleration of vesting of restricted stock in
accordance with the relevant provisions of the Restricted
Stock Agreement;
(e) to continue to receive throughout the Severance Period any executive
medical, dental, life, and qualified or nonqualified retirement benefits
which the Executive was receiving or was entitled to receive at the time of
termination, except that long term disability and short term disability
benefits cease on the last day worked;
(f) outplacement counseling by a firm selected by
Employer to continue until Executive becomes employed; and
(g) to continue to receive throughout the Severance Period all
applicable executive perquisites (including automobile allowance, long
distance services and all miscellaneous services) except country club
membership dues and accrual of vacation.
Employer shall pay or cause to be paid the amounts payable under paragraph
(a) above in equal installments, bi-weekly in arrears, and the amount payable
under paragraphs (b) and (c) in accordance with the terms of the Plans. All
payments pursuant to this Section shall be subject to applicable federal and
state income and other withholding taxes.
In addition to the Special Compensation described above, Executive shall
also be entitled to any vacation pay for vacation accrued by Executive in the
calendar year of termination but not taken at the time of termination.
In the event Executive becomes employed full time during the Severance
Period, Executive's entitlement to continuation of the benefits described in
paragraph (e) shall immediately cease, however, Executive shall retain any
rights to continue medical insurance coverage under the COBRA continuation
provisions of the group medical insurance plan by paying the applicable premium
therefor.
The payments and benefits provided for in this Section shall be in addition
to all other sums then payable and owing to Executive hereunder and, except as
expressly provided herein, shall not be subject to reduction for any amounts
received by Executive for employment or services provided after termination of
employment hereunder, and shall be in full settlement and satisfaction of all of
Executive's claims and demands.
In all events, Executive's right to receive severance and/or other benefits
pursuant to this Section shall cease immediately in the event Executive is
re-employed by Employer or an affiliate or Executive breaches his Confidential
Information Covenant (as defined in Section 11 hereof), or breaches Sections 12,
13 or 14 hereof. In all cases, Employer's rights under Section 15 shall
continue.
6. Voluntary Resignation by Executive; Termination
for Cause; Total Disability
Upon termination of Executive's employment by either Voluntary
Resignation, Termination for Cause (as those terms are defined in this Section
6), or Total Disability, as that term is defined in the Long Term Disability
Plan, Executive shall have no right to compensation, severance pay or other
benefits described herein but Executive's obligations under Sections 11, 12, 13
and 14 hereof shall continue.
(a) Voluntary Resignation by Executive. At any time, Executive has
the right, by written notice to Employer, to terminate his services
hereunder ("Voluntary Resignation"), effective as of thirty (30) days after
such notice.
(b) Termination for Cause by Employer. At any time, Employer has
the right to terminate Executive's employment. Termination upon the
occurrence of any of the following shall be deemed termination for cause
("Termination for Cause"):
(i) Conduct by the Executive which reflects
adversely on the Executive's honesty, trustworthiness
or fitness as an Executive, or
(ii) Executive's willful engagement in conduct which is
demonstrably and materially injurious to the Employer.
For Termination for Cause, written notice of the termination of
Executive's employment by Employer shall be served upon Executive and shall
be effective as of the date of such service. Such notice given by Employer
shall specify the act or acts of Executive underlying such termination.
(c) Total Disability. Upon the total disability of the Executive, as
that term is defined in the Long Term Disability Plan, Executive shall have
no right to compensation or severance pay described herein but shall be
entitled to long term disability and other such benefits afforded under the
applicable policies and plans.
7. Resignation Following Constructive Discharge.
If at any time, except in connection with a termination pursuant to Section
5, 6, or 8 Executive is Constructively Discharged (as that term is defined in
this Section 7) then Executive shall have the right, by written notice to
Employer within sixty (60) days of such Constructive Discharge, to terminate his
services hereunder, effective as of thirty (30) days after such notice.
Executive shall in such event be entitled to the compensation and benefits as if
such employment were terminated pursuant to Section 5 of this Agreement.
For purposes of this Agreement, the Executive shall be "Constructively
Discharged" upon the occurrence of any one of the following events:
(a) Executive is removed from his position with Employer other than as
a result of Executive's appointment to positions of equal or superior scope
and responsibility; or
(b) Executive's targeted total compensation is reduced by more than 10%
(other than across-the-board reductions similarly affecting all officers of
the Long Distance Division of Employer).
8. Effect of Change in Control.
In the event that within one year of a Change in Control (as that term is
defined in this Section 8) Executive's employment is terminated:
(a) by the Employer other than pursuant to Section 6
hereof, or,
(b) by Executive pursuant to Section 7 hereof,
then Executive shall be entitled to the Special Compensation described in
Section 5 and shall be bound by Section 11, but shall not have any continuing
obligations under Sections 12, 13, and 14, except as otherwise required by
common law or statute.
For purposes of this Agreement, a "Change in Control" shall be deemed to
have occurred if:
(i) any "person" (as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934 (the "Exchange Act")) other than a
trustee or other fiduciary holding securities under an employee benefit
plan of Sprint Corporation ("Sprint") or any of its affiliates, and other
than Sprint or a corporation owned, directly or indirectly, by the
stockholders of Sprint in substantially the same proportions as their
ownership of stock of Sprint, is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of Sprint representing 20% or more of the combined voting power
of Sprint's then outstanding securities, or
(ii) during any period of two consecutive years (not including any
period prior to the date of this Agreement), incumbent members cease for
any reason to constitute a majority of the members of the Board of
Directors of Sprint.
A member of the Board of Directors of Sprint shall be an "incumbent member" if
such individual is as of the date of this Agreement or at the beginning of the
applicable two consecutive year period a member of the Board of Directors of
Sprint, and any new director after the date of this Agreement (other than a
director designated by person who has entered into an agreement to effect a
transaction described in subparagraph (i) above) whose election to the Board or
nomination for election by the stockholders of Sprint was approved by a vote of
at least two-thirds (2/3) of the directors still in office who either were
directors as of the date hereof or as of the first day of the applicable two
consecutive year period or whose election or nomination for election was
previously so approved.
9. Dispute Resolution.
All disputes arising under this Agreement, other than those disputes
relating to Executive's alleged violations of Sections 11 through 14 herein,
shall be submitted to arbitration by the American Arbitration Association of
Kansas City, Missouri. Costs of arbitration shall be borne equally by the
parties. The decision of the arbitrators shall be final and there shall be no
appeal from any award rendered. Any award rendered may be entered as a judgment
in any court of competent jurisdiction. In any judicial enforcement proceeding,
the losing party shall reimburse the prevailing party for its reasonable costs
and attorneys' fees for enforcing its rights under this Agreement, in addition
to any damages or other relief granted. This Section 9 does not apply to any
action by Employer to enforce Sections 11 through 14 of this Agreement and does
not in any way restrict Employer's rights under Section 15 herein.
10. Enforcement.
In the event Employer shall fail to pay any amounts due to Executive under
this Agreement as they come due, Employer agrees to pay interest on such amounts
at a rate of prime plus two percent (2%) per annum. Employer agrees that
Executive and any successor shall be entitled to recover all costs of
successfully enforcing any provision of this Agreement, including reasonable
attorney fees and costs of litigation.
11. Confidential Information.
Executive acknowledges that during the course of his employment he has
learned or will learn or develop Confidential Information (as that term is
defined in this Section 11). Executive further acknowledges that unauthorized
disclosure or use of such Confidential Information, other than in discharge of
Executive's duties, will cause Employer irreparable harm.
For purposes of this Section, Confidential Information means trade secrets
(such as technical and non-technical data, a formula, pattern, compilation,
program, device, method, technique, drawing, process) and other proprietary
information concerning the products, processes or services of Employer or its
parent, and/or affiliates, including but not limited to: computer programs;
unpatented inventions, discoveries or improvements; marketing, manufacturing, or
organizational research and development; business plans; sales forecasts;
personnel information, including the identity of other employees of Employer,
their responsibilities, competence, abilities, and compensation; pricing and
financial information; current and prospective customer lists and information on
customers or their employees; information concerning planned or pending
acquisitions or divestitures; and information concerning purchases of major
equipment or property, which information: (a) has not been made generally
available to the public; and (b) is useful or of value to the current or
anticipated business, or research or development activities of Employer or of
any customer or supplier of Employer, or (c) has been identified to Employee as
confidential by Employer, either orally or in writing.
Except in the course of his employment and in the pursuit of the business
of Employer or any of its subsidiaries or affiliates, Executive shall not,
during the course of his employment, or for a period of eighteen (18) months
following termination of his employment for any reason, directly or indirectly,
disclose, publish, communicate or use on his behalf or another's behalf, any
proprietary information or data of Employer or any of its subsidiaries or
affiliates.
Executive acknowledges that Employer operates and competes nationally, and
that Employer will be harmed by unauthorized disclosure or use of Confidential
Information regardless of where such disclosure or use occurs, and that
therefore this confidentiality agreement is not limited to any single state or
other jurisdiction.
12. Non-Competition.
Executive acknowledges that use or disclosure of Confidential Information
described in Section 11 is likely if Executive were to perform
telecommunications functions relating to long distance services on behalf of a
competitor of Employer. Therefore, Executive shall not, for eighteen (18) months
following termination of employment for any reason (the "Non-Compete Period"),
accept any position, including but not limited to a position in the long
distance operations of AT&T or MCI, where the performance of duties in that
position will involve managing, controlling, participating in, investing in,
acting as consultant or advisor to, rendering services for, or otherwise
assisting any person or entity in the long distance business and performing
functions relating to long distance services, including all forms of
interexchange, interstate, intrastate, interlata and international
communications.
Executive acknowledges that Employer operates and competes nationally, and
that therefore this non-competition agreement is not limited to any single state
or other jurisdiction.
This section shall not prevent Executive from using general skills and
experience developed during employment with Employer or other employers; or from
accepting a position of employment with another company, firm, or other
organization which competes with Employer, if its business is diversified and
Executive is employed in a part of the business that is not related to long
distance Services and provided that such position does not require or permit the
disclosure or use of Confidential Information.
13. Inducement of Other Employees.
For a eighteen (18) month period following termination of employment,
Executive will not directly or indirectly solicit, induce or encourage any
employee or agent of Employer to terminate his relationship with Employer.
14. Return of Employer's Property.
All notes, reports, sketches, plans, published memoranda or other documents
created, developed, generated or held by Executive during employment, concerning
or related to Employer's business, and whether containing or relating to
Confidential Information or not, are the property of Employer and will be
promptly delivered to Employer upon termination of Executive's employment for
any reason whatsoever. During the course of employment, Executive shall not
remove any of the above property containing Confidential Information, or
reproductions or copies thereof, or any apparatus from Employer's premises
without authorization.
15. Remedies.
Executive acknowledges that the restraints and agreements herein provided
are fair and reasonable, that enforcement of the provisions of Sections 11, 12,
13 and 14 will not cause him undue hardship and that said provisions are
reasonably necessary and commensurate with the need to protect Employer and its
legitimate and proprietary business interests and property from irreparable
harm.
Executive acknowledges that failure to comply with the terms of this
Agreement will cause irreparable damage to Employer. Therefore, Executive agrees
that, in addition to any other remedies at law or in equity available to
Employer for Executive's breach or threatened breach of this Agreement, Employer
is entitled to specific performance or injunctive relief, without bond, against
Executive to prevent such damage or breach, and the existence of any claim or
cause of action Executive may have against Employer will not constitute a
defense thereto. Executive further agrees to pay reasonable attorney fees and
costs of litigation incurred by Employer in any proceeding relating to the
enforcement of the Agreement or to any alleged breach thereof in which Employer
shall prevail in whole or in part.
In the event of a breach or a violation by Executive of any of the
covenants and provisions of this Agreement, the running of the Non-Compete
Period (but not of Executive's obligation thereunder), shall be tolled during
the period of the continuance of any actual breach or violation.
16. Confidentiality of Agreement.
As a specific condition to Executive's right to Special Compensation or
other benefits described herein, Executive agrees that he will not disclose or
discuss: the existence of this Agreement; the Special Compensation provided
hereunder; or any other terms of the Agreement except: (1) to members of his
immediate family; (2) to his financial advisor or attorney but then only to the
extent necessary for them to assist him; or (3) as required by law or to enforce
legal rights.
17. Entire Understanding.
This Agreement constitutes the entire understanding between the parties
relating to Executive's employment hereunder and supersedes and cancels all
prior written and oral understandings and agreements with respect to such
matters, except for the terms and provisions of the Key Management Benefit Plan
and any other employee benefit or other compensation plans (or any agreements or
awards thereunder) referred to in or contemplated by this Agreement and except
for the SPRINT UNITED EMPLOYEE AGREEMENT REGARDING PROPERTY RIGHTS AND BUSINESS
PRACTICES which the Executive has signed and by which Executive continues to be
bound.
18. Binding Effect.
This Agreement shall be binding upon and inure to the benefit of Executive's
executors, administrators, legal representatives, heirs and legatees and the
successors and assigns of Employer.
19. Partial Invalidity.
The various provisions of this Agreement are intended to be severable and
to constitute independent and distinct binding obligations. Should any provision
of this Agreement be determined to be void and unenforceable, in whole or in
part, it shall not be deemed to affect or impair the validity of any other
provision or part thereof, and such provision or part thereof shall be deemed
modified to the extent required to permit enforcement. Without limiting the
generality of the foregoing, if the scope of any provision contained in this
Agreement is too broad to permit enforcement to its full extent, but may be made
enforceable by limitations thereon, such provision shall be enforced to the
maximum extent permitted by law, and Executive hereby agrees that such scope may
be judicially modified accordingly.
20. Strict Construction.
The language used in this Agreement will be deemed to be the language
chosen by Employer and Executive to express their mutual intent and no rule of
strict construction shall be applied against any person.
21. Waiver.
The waiver of any party hereto of a breach of any provision of this
Agreement by any other party shall not operate or be construed as a waiver of
any subsequent breach.
22. Notices.
Any notice or other communication required or permitted to be given
hereunder shall be determined to have been duly given to any party (a) upon
delivery to the address of such party specified below if delivered personally or
by courier; (b) upon dispatch if transmitted by telecopy or other means of
facsimile, provided a copy thereof is also sent by regular mail or courier; or
(c) within forty-eight (48) hours after deposit thereof in the U.S. mail,
postage prepaid, for delivery as certified mail, return receipt requested,
addressed, in any case to the party at the following address(es) or telecopy
numbers:
If to Executive:
Xxxx X. Xxxxxx
Sprint Communications Company, L.P.
0000 Xxxx Xxxxxxx
Xxxxxx Xxxx, XX 00000
If to Employer and/or Company:
Sprint Corporation
0000 Xxxxxxx Xxxxxxx Xxxxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Secretary
or to such other address(es) or telecopy number(s) as any party may designate by
Written Notice in the aforesaid manner.
23. Governing Law.
This Agreement shall be governed by, and interpreted, construed and
enforced in accordance with, the laws of the State of Kansas.
24. Gender and Number.
Wherever from the context it appears appropriate, each term stated in
either the singular of plural shall include the singular and the plural, and the
pronouns stated in either the masculine, the feminine or the neuter gender shall
include the masculine, feminine or neuter.
25. Headings.
The headings of the Sections of this Agreement are for reference purposes
only and do not define or limit, and shall not be used to interpret or construe
the contents of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed at Westwood, Kansas, on the date above set forth.
XXXX X. XXXXXX SPRINT/UNITED MANAGEMENT COMPANY
/s/Xxxx X. Xxxxxx By:/s/X. Xxxxxx
Authorized Officer
AMENDMENT
The Agreement Regarding Special Compensation and Post Employment
Restrictive Covenants (the "Special Agreement") between Sprint/United Management
Company and Xxxx X. Xxxxxx (the "Executive") is hereby amended as follows,
effective January 3, 1994:
1. The first sentence of Section 8 shall be changed by adding the word "or"
at the end of item (b) and by adding the following item (c):
(c) by Executive if Executive is required to be based anywhere other
than the Kansas City metropolitan area or the Dallas, Texas
metropolitan area except for required travel on business to an extent
substantially consistent with Executive's business travel obligations
immediately prior to the Change in Control;
2. Section 12 shall be changed by:
(a) deleting from the second sentence of the first paragraph the words
"the performance of duties in that position will involve", and
substituting in lieu thereof the words "Executive dedicates his time
and efforts principally to"; and
(b) changing the last sentence of the Section to read:
This section shall not prevent Executive from using general skills and
experience developed during employment with Employer or other
employers; or from accepting a position of employment with another
company, firm, or other organization which competes with Employer, if
its business is diversified and Executive is employed in a part of the
business that is not related principally to long distance services and
provided that such position does not require or permit the disclosure
or use of Confidential Information.
Except as amended herein, the terms of the Special Agreement shall remain
in effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed at Westwood, Kansas, as of the date above set forth.
EXECUTIVE SPRINT/UNITED MANAGEMENT
COMPANY
/s/ Xxxx X. Xxxxxx By: /s/ X. Xxxxxx
1/10/94 Title: SVP - HR
