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EXHIBIT 10.15
EMPLOYMENT AGREEMENT
THIS AGREEMENT ("Agreement"), dated as of April 15, 1999, by and
between OPTEL, INC., a Delaware corporation (the "Company"), and XXXX X. XXXX
("Executive").
W I T N E S S E T H :
WHEREAS, Executive is currently employed by the Company as Vice
President Human Resources of the Company; and
WHEREAS, the Company desires to continue to employ Executive and
Executive has agreed to such continuation, subject to the terms of this
Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants contained herein, the Company and Executive (individually a "Party"
and together the "Parties") agree as follows:
1. Definitions.
As used in this Agreement, unless the context otherwise requires:
(a) "Affiliate" of a Person shall mean a Person that directly or
indirectly controls, is controlled by, or is under common control with the
Person specified.
(b) "Aggregate Life Insurance Benefits" shall have the meaning set
forth in Section 9(a)(ii).
(c) "Average Annual Bonus" shall mean the average of the two most
recent annual bonuses (not including any payments from long-term incentive
programs) received by or due to Executive for completed fiscal years immediately
prior to the termination of the Term of Employment.
(d) "Base Salary" shall mean the salary provided for in Section 4.
(e) "Board" shall mean the Board of Directors of the Company.
(f) "Cause" shall mean:
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(i) Executive's conviction of a crime involving moral
turpitude (excluding offenses such as driving while intoxicated); or
(ii) Executive's (A) commission of a fraud upon the Company
or (B) material breach of this Agreement (including by wilfully failing or
neglecting to perform Executive's duties hereunder), which breach, if curable,
is not substantially cured within 10 days after written notice to Executive
specifying the nature of the breach.
(g) A "Change in Control" shall mean the occurrence of any one of
the following events:
(i) Any "person," as such term is used in Sections 3(a)(9)
and 13(d) of the Securities Exchange Act of 1934 (other than Executive, Le
Groupe Videotron Ltee, Sojecci Ltee, Sojecci (1995) Ltee, Xxxxx Xxxxxxx and his
spouse and descendants, Caisse de depot et placement du Quebec, and their
respective Affiliates (collectively, all or any of Le Groupe Videotron Ltee,
Sojecci Ltee, Sojecci (1995) Ltee, Xxxxx Xxxxxxx and his spouse and descendants,
Caisse de depot et placement du Quebec, and their respective Affiliates
constitute the "Existing Control Group")), is a "beneficial owner," as such term
is used in Rule 13d-3 promulgated under that act, of shares of the Voting Stock
of the Company having more total votes in an election for directors than shares
of Voting Stock of which the Existing Control Group is the beneficial owner and,
at the same time, the Existing Control Group does not have the power, by
contract or otherwise, to elect or designate a majority of the members of the
Board;
(ii) the majority of the members of the Board consists of
individuals other than Incumbent Directors, which term means the members of the
Board on the date of this Agreement; provided that any individual becoming a
director subsequent to such date whose election or nomination for election as a
director was supported by two-thirds of the directors who were Incumbent
Directors at the time of such election or nomination shall be an Incumbent
Director;
(iii) the Company adopts any plan of liquidation providing
for the distribution of all or substantially all of its assets;
(iv) all or substantially all of the assets or business of
the Company are disposed of pursuant to a merger, consolidation or other
transaction (unless the shareholders of the Company immediately prior to such
merger, consolidation or other transaction beneficially own, directly or
indirectly, in substantially the same proportion as they owned the Voting Stock
of the Company, the Voting Stock or other ownership interests of the Person or
Persons, if any, that succeed to the business of the Company) and at any time
thereafter the Existing Control Group does not have the power, by contract or
otherwise, to elect or designate a majority of the members of the Board; or
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(v) the Company combines with another Person and is the
surviving corporation but, immediately after the combination, the shareholders
of the Company immediately prior to the combination hold, directly or
indirectly, not more than 50% of the Voting Stock of the surviving corporation
(there being excluded from the number of shares held by such shareholders, but
not from the Voting Stock of the surviving corporation, any shares received by
Affiliates of such other Person in exchange for stock of such other Person) and
at any time thereafter the Existing Control Group does not have the power, by
contract or otherwise, to elect or designate a majority of the members of the
Board.
(h) "Confidential Information" shall mean all information that is
not known or available to the public concerning the business of the Company or
any Subsidiary relating to its products, product development, trade secrets,
customers, suppliers, finances, and business plans and strategies. For this
purpose, information known or available generally within the trade or industry
of the Company or any Subsidiary shall be deemed to be known or available to the
public. Confidential Information shall include information that is, or becomes,
known to the public as a result of a breach by Executive of the provisions of
Section 13.
(i) "Constructive Termination Without Cause" shall mean a
termination of the Term of Employment by written notice given by Executive
within 60 days following the occurrence, without Executive's prior written
consent, of one or more of the following events (except in consequence of a
prior termination):
(i) a reduction in or elimination of (A) Executive's then
current Base Salary, or (B) Executive's opportunity for any long-term incentive
award for which she is eligible under Section 6 or the termination or material
reduction of any material employee benefit or perquisite enjoyed by her
including the bonus provided for under Section 5; provided, however, that in the
case of clause (B), only if the reduction or elimination is greater than that
applied to other executives of the Company of the same class or level as
Executive;
(ii) the failure to elect or reelect Executive to the
position specified in Section 3(a), or Executive's removal, without Cause, from
such position, or a material diminution in Executive's duties, authority or
responsibilities as described in Section 3(a), or the assignment to Executive of
duties which are materially inconsistent with such duties or which materially
impair Executive's ability to function in such position, and, in the case of any
such assignment, the failure of the Company to cure such inconsistency or
impairment within 15 days after its receipt of notice thereof from Executive;
(iii) the failure to continue Executive's participation in
any incentive compensation plan for which Executive is eligible unless
executives of the same class or level as Executive also cease to participate in
such plan or a plan providing a substantially similar opportunity is
substituted; or
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(iv) the relocation of the Company's principal office outside
the area comprised by Dallas and Tarrant Counties, Texas, having dimensions of
approximately 58 miles by 29 miles and commonly referred to as the Dallas-Fort
Worth Metroplex.
(j) "Disability" shall mean Executive's inability, due to physical
or mental incapacity, to substantially perform Executive's duties and
responsibilities under this Agreement for a period of 180 consecutive days or
for 180 days in a 365-day period.
(k) "MDU Business" shall mean the delivery of video and
telecommunications services to residential multiple dwelling units.
(l) "Minimum Severance Period" shall have the meaning set forth in
Section 9(d)(vi)(A), subject to modification as provided in Section 9(e) in the
event of a Change in Control.
(m) "Non-Extension Event" shall mean any termination of the Term
of Employment resulting from an election by the Company not to renew the Term of
Employment.
(n) "Person" shall mean an individual, firm, corporation, trust,
joint venture, partnership, limited liability company, association,
unincorporated organization or other entity or any governmental body or
subdivision, agency, commission or authority thereof.
(o) "Stock" shall mean the Common Stock of the Company.
(p) "Subsidiary" shall mean any Person of which the Company owns,
directly or indirectly, more than 50% of the Voting Stock or, in the case of a
Person other than a corporation, more than 50% of the equity interest.
(q) "Term of Employment" shall mean the period or periods
specified in Section 2.
(r) "Voting Stock" shall mean capital stock of any class or
classes having general voting power under ordinary circumstances, in the absence
of contingencies, to elect a majority of the directors of a corporation.
2. Term of Employment.
The Company hereby employs Executive, and Executive hereby accepts
such employment, for the Term of Employment commencing April 15, 1999 and ending
at the close of business on April 15, 2001, subject to earlier termination of
the Term of Employment in accordance with the terms of this Agreement. The Term
of Employment shall be automatically renewed from year to year unless either the
Company or Executive provides the other with
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written notice of non-renewal at least 30 days prior to the date on which the
Term of Employment would otherwise expire.
3. Position, Duties and Responsibilities.
(a) During the Term of Employment, Executive shall be employed as
Vice President Human Resources of the Company. In that capacity Executive shall
have the duties, authority and responsibilities normally associated with such
position and shall report to the Chief Executive Officer of the Company.
Executive shall, at the request of the Board or the Chief Executive Officer of
the Company, also serve as an officer and/or director of one or more
Subsidiaries without additional compensation.
(b) During the Term of Employment Executive shall devote his full
attention and expend his best efforts, energies and skills on a full-time basis
to the business of the Company and its Subsidiaries.
(c) Executive's services to the Company will be rendered primarily
at the Company's principal office. Executive acknowledges, however, that
Executive's services may require extensive travel.
(d) Nothing herein shall preclude Executive from (i) serving as a
director of one or more other corporations not engaged in competition with the
Company or of one or more trade associations and/or charitable organizations,
subject in each case to prior approval by the Chief Executive Officer of the
Company, (ii) engaging in charitable activities and community affairs, (iii)
managing Executive's personal investments and affairs and those of her family,
and (iv) engaging in other business transactions, provided that such activities
individually and in the aggregate do not reflect adversely on Executive's
personal or business reputation or the Company or its business and do not
interfere with the proper performance of Executive's duties and responsibilities
to the Company and its Subsidiaries.
4. Base Salary.
Executive shall receive Base Salary from the Company at the annual
rate of $138,000, payable in accordance with the regular payroll practices of
the Company, but in no event less frequently than monthly. Executive's Base
Salary shall be subject to review by the Company on an annual basis but shall
not be decreased.
5. Annual Bonus.
Executive shall be entitled to be considered for receipt of an
annual bonus, the calculation of which is to be determined in accordance with an
incentive plan established and administered by the Board which includes a
"target" bonus for Executive for each bonus period, as such plan may be modified
by the Board from time to time.
6. Long-Term Incentive Programs.
Executive shall be eligible to participate in any long-term
incentive programs of the Company on the same basis as other senior executives
of the Company.
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7. Employee Benefit Programs and Vacation.
(a) During the Term of Employment Executive shall be entitled to
participate in all employee pension and welfare benefit plans and programs made
available to the Company's senior executives generally, as such plans or
programs may be in effect from time to time.
(b) Executive shall be entitled to four weeks of vacation per
year.
8. Reimbursement of Business and Other Expenses and Perquisites.
(a) Executive is authorized to incur reasonable business expenses
in carrying out his duties and responsibilities under this Agreement, and the
Company shall promptly reimburse Executive for all such expenses, all subject to
and in accordance with the Company's policies and procedures as adopted and in
effect from time to time and applicable to its senior executives of comparable
status.
(b) To assist Executive in the performance of his duties and
responsibilities under this Agreement, the Company shall provide to Executive an
allowance for the use of an automobile in accordance with the Company's policies
applicable generally to the Company's senior executives of comparable class or
status; provided, however, that, if Executive currently uses a leased automobile
provided by the Company, then in lieu of such allowance the Company may continue
to provide Executive with the use of such leased automobile for the remaining
initial term of the applicable lease.
(c) Executive shall be eligible to receive all perquisites made
generally available by the Company to its senior executives of comparable class
or status.
9. Termination of Term of Employment.
(a) Termination Due to Death. The Term of Employment shall
terminate upon Executive's death. In the event of such termination due to
Executive's death, Executive's estate or Executive's beneficiaries, as the case
may be, shall be entitled to:
(i) the proceeds payable in the event of Executive's death
under the group life insurance policy maintained by the Company for the benefit
of its senior executive employees and others;
(ii) an amount, payable promptly in a lump sum, equal to the
excess, if any, of (A) Base Salary for the unexpired portion of the Term of
Employment remaining as of the time immediately prior to Executive's death, over
(B) the aggregate amount of life insurance proceeds payable to Executive's
estate or beneficiaries pursuant to clause (i) of
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this Section 9(a) or pursuant to any other policy on Executive's life for which
premiums are paid by the Company or any of its Affiliates (the "Aggregate Life
Insurance Benefits");
(iii) if the date of Executive's death coincides with the
last day of a bonus period, a bonus for such bonus period in accordance with the
terms of the applicable incentive plan; otherwise, a bonus for the bonus period
in which Executive's death occurs, determined pro rata with respect to
Executive's target bonus for such bonus period based on the number of completed
months of Executive's employment by the Company during such bonus period;
(iv) the balance of any bonus earned (but not yet paid) for
any bonus period prior to the bonus period in which Executive's death occurs;
(v) any amounts earned, accrued or owing but not yet paid
under Section 6, 7 or 8; and
(vi) any other or additional benefits provided for in
accordance with applicable plans and programs of the Company.
(b) Termination Due to Disability. The Term of Employment may be
terminated by the Company by written notice to Executive in the case of
Executive's Disability. In the event of such termination due to Disability,
Executive shall be entitled to:
(i) an amount, payable promptly in a lump sum, equal to the
excess, if any, of (A) Base Salary for the unexpired portion of the Term of
Employment remaining as of the time immediately prior to such termination, over
(B) the amount of any disability benefits provided to Executive by the Company
or under any disability insurance paid for, or for which premiums paid by
Executive were reimbursed, by the Company;
(ii) if such termination coincides with the last day of a
bonus period, a bonus for such bonus period in accordance with the terms of the
applicable incentive plan; otherwise, a bonus for the bonus period in which such
termination occurs, determined pro rata with respect to Executive's target bonus
for such bonus period based on the number of completed months of Executive's
employment by the Company during such bonus period,
(iii) the balance of any bonus earned (but not yet paid) for
any bonus period prior to the bonus period in which such termination occurs;
(iv) any amounts earned, accrued or owing but not yet paid
under Section 6, 7 or 8; and
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(v) any other or additional benefits provided for in
accordance with applicable plans and programs of the Company.
(c) Termination by the Company for Cause. In the event the Company
terminates the Term of Employment for Cause, Executive shall be entitled to:
(i) Base Salary through the date of such termination;
(ii) any bonus earned (but not yet paid) for any bonus period
prior to the bonus period in which such termination occurs;
(iii) any amounts earned, accrued or owing but not yet paid
under Section 6, 7 or 8; and
(iv) any other or additional benefits provided for in
accordance with applicable plans or programs of the Company.
(d) Termination Without Cause or Constructive Termination Without
Cause. In the event the Term of Employment is terminated by the Company without
Cause, other than due to Executive's Disability or death, or in the event the
Term of Employment is terminated due to a Constructive Termination Without
Cause, Executive shall be entitled to:
(i) Base Salary through the date of such termination;
(ii) if the date of such termination coincides with the last
day of a bonus period, a bonus for such bonus period in accordance with the
terms of the applicable incentive plan; otherwise, a bonus for the bonus period
in which such termination occurs, determined pro rata with respect to
Executive's target bonus for such bonus period based on the number of completed
months of Executive's employment by the Company during such bonus period;
(iii) the balance of any bonus earned (but not yet paid) for
any bonus period prior to the bonus period in which such termination occurs;
(iv) any amounts earned, accrued or owing but not yet paid
under Section 6, 7 or 8;
(v) any other or additional benefits provided for in
accordance with applicable plans and programs of the Company; and
(vi) to elect, within 30 days after such termination, either
(x) to cease being an employee of the Company and receive the lump-sum payment
described in
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section 9(d)(vi)(A) or (y) to remain an employee of the Company for the period
described in Section 9(d)(vi)(B). After Executive makes such election, the
following provisions shall apply:
(A) In the event Executive makes the election provided in
clause (x) of Section 9(d)(vi), then, subject to the requirements of
Section 9(j), the Company shall pay to Executive in a lump sum: (1) an
amount equal to Base Salary for the period (the "Minimum Severance
Period") that is the longer of 12 months or the unexpired portion of
the Term of Employment remaining as of the time immediately prior to
such termination, plus (2) an amount equal to Average Annual Bonus
pro-rata for the Minimum Severance Period.
(B) In the event Executive makes the election provided in
clause (y) of Section 9(d)(vi), then, subject to the requirements of
Section 9(j), Executive will remain an employee of the Company (but
without any title) until the end of the Minimum Severance Period, and
the Company shall pay to Executive Base Salary for such period plus
Average Annual Bonus pro-rata for such period; provided, however, that
(1) if Executive dies during such period, Executive's
payments pursuant to this Section 9(d)(vi)(B) shall cease, and
Executive's estate or beneficiaries, as the case may be, will
be entitled to receive the Aggregate Life Insurance Benefits
plus a lump sum amount (which shall be paid by the Company
promptly after Executive's death) equal to the excess, if any,
of (x) the balance of the payments of Base Salary and Average
Annual Bonus that Executive would have been entitled to
receive pursuant to this Section 9(d)(vi)(B) had Executive
remained on the Company's payroll until the end of such period
over (y) the amount of the Aggregate Life Insurance Benefits;
and
(2) if Executive accepts substantially full-time
employment with any other Person during such period or
notifies the Company in writing of Executive's intention to
terminate his employment during such period, Executive will
cease to be an employee of the Company effective upon the
earlier of the effective date of such termination as specified
by Executive in such notice or the commencement of such
employment, and the Company shall promptly pay to Executive a
lump sum equal to the balance of the payments of Base Salary
and Average Annual Bonus that Executive would have been
entitled to receive pursuant to this Section 9(d)(vi)(B) had
Executive remained on the Company's payroll until the end of
such period.
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(C) In the event Executive makes the election provided in
clause (y) of Section 9(d)(vi), then during the period Executive
remains on the payroll of the Company, Executive will continue to be
eligible to receive the medical and life insurance benefits which all
other employees of the Company are then entitled to receive, as such
benefits may be amended, changed or eliminated from time to time.
Executive shall not be entitled to any other perquisite or benefit
provided by the Company to its senior executives or employees generally
or otherwise specifically provided for in this Agreement and shall not
be entitled to any additional awards or grants under any long-term
incentive plan. In the event Executive makes the election provided in
clause (y) of Section 9(d)(vi), Executive will continue to be an
employee of the Company for purposes of any stock option and restricted
shares agreements until such time as Executive leaves the payroll of
the Company.
(e) Acceleration of Entitlements in Connection with a Change in
Control or Termination. Upon a Change in Control (regardless of whether
Executive continues in employment by the Company or the termination of the Term
of Employment for any reason whatsoever) Executive shall become immediately
entitled to exercise in full any stock option to acquire Stock during the
remainder of the term of such option. Without limitation of the preceding
sentence, upon the termination of the Term of Employment (including upon a Non-
Extension Event or Disability or death) otherwise than for Cause, Executive
shall become immediately entitled to exercise in full any stock option to
acquire Stock during the remainder of the term of such option, to the extent
such option would otherwise have vested or become exercisable within 12 months
after such termination of the Term of Employment but, unless a Change in Control
shall have occurred, all such options that have not previously expired shall
automatically expire on the date that is 12 months after such termination of the
Term of Employment. If, in connection with a Change in Control or within 12
months after a Change in Control, the Term of Employment is terminated without
Cause, other than due to Disability or death, or due to a Constructive
Termination Without Cause, then, without limitation of the payments, benefits
and elections provided in Section 9(d) and the first sentence of this Section
9(e), upon such Change in Control or such later termination, all amounts,
entitlements and benefits awarded to Executive or to which Executive is
otherwise entitled under any grant, plan or program of the Company but which are
not yet vested shall become fully vested except to the extent such vesting would
be inconsistent with the terms of the relevant plan. Without limitation of the
benefits to Executive pursuant to the preceding sentence or any of the other
provisions of this Agreement, if, in connection with a Change in Control or
within 12 months after a Change in Control, the Term of Employment is terminated
due to a Constructive Termination Without Cause or by the Company without Cause
(other than due to Disability or death), then, (A) the "Minimum Severance
Period" for purposes of Section 9(d) shall be not less than 24 months and (B)
upon such Change in Control (or such later termination) all amounts,
entitlements and benefits awarded to Executive or to which Executive is
otherwise entitled under any grant, plan or program of the Company but which are
not yet vested shall become fully vested except to the
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extent such vesting would be inconsistent with the terms of the relevant plan.
In connection with the occurrence of a Change in Control, Executive and the
Company agree to negotiate in good faith payment arrangements and covenant
changes (without reducing the total amount payable pursuant to this Section
9(e)) designed to preserve to the Company the deductibility for federal income
tax purposes of, and eliminate any excise tax imposed by Section 4999 of the
Code payable in respect of, amounts paid or benefits inuring to Executive
pursuant to this Section 9(e).
(f) Voluntary Termination. A termination of the Term of Employment
by Executive on his own initiative, other than a termination due to death or
Disability or a Constructive Termination without Cause, shall be treated as a
Termination for Cause, and, accordingly, Executive shall have only the
entitlements provided in Section 9(c).
(g) Termination Because of Non-Renewal. In the event of a Non-
Extension Event, Executive shall be entitled to:
(i) Base Salary through the date of expiration of the Term of
Employment;
(ii) if the expiration of the Term of Employment coincides
with the last day of a bonus period, a bonus for such bonus period in accordance
with the terms of the applicable incentive plan; otherwise, a bonus for the
bonus period in which the Term of Employment expires, determined pro rata with
respect to Executive's target bonus for such bonus period based on the number of
completed months of Executive's employment by the Company during such bonus
period;
(iii) the balance of any bonus earned (but not yet paid) for
any bonus period prior to the bonus period in which the Term of Employment
expires;
(iv) any amounts earned, accrued or owing but not yet paid
under Section 6, 7 or 8;
(v) any other or additional benefits provided for in
accordance with applicable plans and programs of the Company; and
(vi) to elect within 30 days after such termination, either
(x) to cease being an employee of the Company and receive the lump-sum payment
described in section 9(g)(vi)(A) or (y) to remain an employee of the Company for
the period described in Section 9(g)(vi)(B). After Executive makes such
election, the following provisions shall apply:
(A) In the event Executive makes the election provided in
clause (x) of Section 9(g)(vi), subject to the requirements of Section
9(j), the Company shall pay to Executive in a lump sum: (1) an amount
equal to Base
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Salary for a period of 12 months (or 24 months, if a Change in Control
has occurred during the Term of Employment and the Term of Employment
has not been renewed at least once after the Change in Control), plus
(2) an amount equal to Average Annual Bonus pro-rata for the same
period.
(B) In the event Executive makes the election provided in
clause (y) of Section 9(g)(vi), subject to the requirements of Section
9(j), Executive will remain an employee of the Company (but without any
title) for the period of 12 months following the expiration of the Term
of Employment (or 24 months, if a Change in Control has occurred during
the Term of Employment and the Term of Employment has not been renewed
at least once after the Change in Control), and the Company shall pay
to Executive Base Salary for such period plus Average Annual Bonus
pro-rata for such period; provided, however, that
(1) if Executive dies during such period, Executive's
payments pursuant to this Section 9(g)(vi)(B) shall cease, and
Executive's estate or beneficiaries, as the case may be, will be
entitled to receive the Aggregate Life Insurance Benefits, plus a
lump sum amount (which shall be paid by the Company promptly
after Executive's death) equal to the excess, if any, of (x) the
balance of the payments of Base Salary and Average Annual Bonus
that Executive would have been entitled to receive pursuant to
this Section 9(g)(vi)(B) had Executive remained on the Company's
payroll until the end of such period over (y) the amount of the
Aggregate Life Insurance Benefits; and
(2) if Executive accepts substantially full-time employment
with any other Person during such period or notifies the Company
in writing of Executive's intention to terminate Executive's
employment during such period, Executive will cease to be an
employee of the Company, effective upon the earlier of the
effective date of such termination as specified by Executive in
such notice or the commencement of such employment, and the
Company shall promptly pay to Executive a lump sum equal to the
balance of the payments of Base Salary and Average Annual Bonus
that Executive would have been entitled to receive pursuant to
this Section 9(g)(vi)(B) had Executive remained on the Company's
payroll until the end of such period.
(C) In the event Executive makes an election provided in
clause (y) of Section 9(g)(vi), then during the period Executive
remains on the payroll of the Company, Executive will continue to be
eligible to receive the medical and life insurance benefits all other
employees of the Company are then entitled to receive, as amended,
changed or eliminated, from time to time. Executive shall
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not be entitled to any other perquisite or benefit provided by the
Company to its senior executives generally or otherwise specifically
provided for in this Agreement and shall not be entitled to any
additional awards or grants under any long-term incentive plan. In the
event of an election pursuant to clause (y) of Section 9(d)(vi),
Executive will continue to be an employee of the Company for purposes
of any stock option and restricted shares agreements until such time as
Executive leaves the payroll of the Company.
(h) No Mitigation; No Offset. In the event of any termination of
the Term of Employment under this Section 9, Executive shall be under no
obligation to seek other employment and there shall be no offset against amounts
due Executive under this Agreement on account of any remuneration attributable
to any subsequent employment obtained by Executive except as specifically
provided in this Section 9.
(i) Nature of Payments. Any amounts due under this Section 9 are
in the nature of severance payments considered to be reasonable by the Company
and are not in the nature of a penalty.
(j) General Release. In partial consideration for, and as a
condition of, the Company's obligation to make the payments described in
Sections 9(d)(vi) and 9(g)(vi), Executive shall execute and deliver to the
Company a release of all claims Executive shall then have against the Company,
its Affiliates and their related Persons arising out of or in connection with
Executive's employment or termination of employment, including, but not limited
to, a release of all claims of discrimination. The Company will deliver such
release to Executive at or about the time it delivers or receives the notice of
termination, and Executive shall execute and deliver such release to the Company
within 21 days thereafter, except that in case of expiration of the Term of
Employment following a Non-Extension Event, the release will be delivered to
Executive upon such expiration and shall be executed and delivered by Executive
within 21 days after such expiration. If Executive fails to execute and deliver
such release to the Company within such 21-day period, or if Executive revokes
Executive's consent to such release as provided for therein, Executive will not
be eligible to receive any further payments from the Company pursuant to Section
9(d)(vi) or 9(g)(vi).
(k) Other Severance. In the event the Company's written severance
pay policy applicable to Executive provides for greater severance pay and
benefits than are provided for in Section 9(d) or 9(g), Executive may elect to
receive termination pay and benefits under the terms and conditions of such
policy in lieu of the payments and benefits under Section 9(d) or 9(g). It is
understood by the Parties that Executive shall not be entitled to both the
payments and benefits under the severance pay policy and those available under
Section 9(d) or 9(g). Notwithstanding the foregoing, in addition to being
entitled to the greater of the payments and benefits under the severance pay
policy and under Section 9(d) or 9(g), as applicable, Executive shall be
entitled to professional outplacement services (including office space and
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secretarial services), at a cost not exceeding 10% of Executive's annual Base
Salary, in accordance with the Company's policies regarding outplacement
services; provided, however, that payments pursuant to this sentence shall be
made only for actual outplacement services, and Executive shall not have the
option to elect to receive all or part of the maximum allowances therefor in
lieu of outplacement services.
10. Indemnification.
(a) The Company agrees that if Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "Proceeding"), by reason of the
fact that Executive is or was a director, officer or employee of the Company or
is or was serving at the request of the Company as a director, officer, member,
employee or agent of another Person, including service with respect to employee
benefit plans, whether or not the basis of such Proceeding is Executive's
alleged action in an official capacity while serving as a director, officer,
member, employee or agent, Executive shall be indemnified and held harmless by
the Company to the fullest extent permitted or authorized by the Company's
certificate of incorporation or bylaws or, if greater, by the laws of the State
of Delaware, against all cost, expense, liability and loss (including, without
limitation, attorney's fees, judgments, fines, ERISA excise taxes (other than
such as may be imposed with respect to compensation received by Executive) or
penalties and amounts paid or to be paid in settlement) reasonably incurred or
suffered by Executive in connection therewith, and such indemnification shall
continue as to Executive even if Executive has ceased to be a director, member,
employee or agent of the Company or other Person and shall inure to the benefit
of Executive's heirs, executors and administrators. The Company shall advance to
Executive to the extent permitted by law all reasonable costs and expenses
incurred by him in connection with a Proceeding within 20 days after receipt by
the Company of a written request, with appropriate documentation, for such
advance. Such request shall include an undertaking by Executive to repay the
amount of such advance if it shall ultimately be determined that Executive is
not entitled to be indemnified against such costs and expenses.
(b) The Company agrees to continue and maintain a directors' and
officers' liability insurance policy covering Executive to the extent the
Company provides such coverage for its other executive officers.
(c) Promptly after receipt by Executive of notice of any claim or
the commencement of any action or proceeding with respect to which Executive is
entitled to indemnity hereunder, Executive shall notify the Company in writing
of such claim or the commencement of such action or proceeding, and the Company
shall (i) assume the defense of such action or proceeding, (ii) employ counsel
reasonably satisfactory to Executive and (iii) pay the reasonable fees and
expenses of such counsel. Notwithstanding the preceding sentence, Executive
shall be entitled to employ counsel separate from counsel for the Company and
from any other party in such action if Company counsel reasonably determines
that a conflict of
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interest exists which makes representation by counsel chosen by the Company not
advisable. In such event, the reasonable fees and disbursements of such separate
counsel for Executive shall be paid by the Company to the extent permitted by
law.
(d) After the Term of Employment, (i) at the request of the
Company, Executive shall cooperate with and assist the Company (to the extent
that such activities do not unreasonably interfere with the performance of
Executive's other business activities or employment) to prepare for or defend
against any action, suit, proceeding or claim brought or threatened to be
brought against the Company or to prepare for or institute any action, suit,
proceeding or claim to be brought or threatened to be brought against a third
party arising out of or based upon any matter or thing whatsoever arising out of
or which may be related to matters as to which Executive has or acquires
knowledge or information by reason of his employment by the Company or any of
its Subsidiaries, and (ii) upon the request of Executive, the Company shall
reimburse Executive for all reasonable travel, legal and other out-of-pocket
expenses that may be incurred by Executive related to assisting the Company, at
its request, to prepare for or defend against any such action, suit, proceeding
or claim brought or threatened to be brought against the Company or to prepare
for or institute any action, suit, proceeding or claim to be brought or
threatened to be brought against a third party and in providing evidence,
producing documents or otherwise participating in any such action, suit,
proceeding or claim.
11. Effect of Agreement on Other Benefits.
Except as specifically provided in this Agreement, the existence
of this Agreement shall not prohibit or restrict Executive's entitlement to full
participation in the employee benefit and other plans or programs in which
senior executives of the Company are eligible to participate.
12. Confidentiality.
Executive acknowledges that Executive is bound by that certain
nondisclosure agreement executed by Executive upon the commencement of his
employment with the Company and that the terms thereof shall not be modified or
affected by this Agreement.
13. Non-Competition.
(a) During the Term of Employment and (unless the Term of
Employment expires following a Non-Extension Event or is terminated by the
Company without Cause or voluntarily by Employee due to a Constructive
Termination Without Cause) for a period of nine months thereafter, Executive
shall not, directly or indirectly, except when acting on behalf of the Company,
whether as an employee, consultant, partner, principal, agent, distributor,
representative, stockholder or otherwise, plan, develop, conduct or otherwise
engage in the MDU Business in any metropolitan area world-wide in which the
Company or any
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Subsidiary then conducts or is actively planning to conduct the MDU Business
(except that he may be a stockholder holding not more than a 1% common stock
interest in a Person whose shares are publicly traded and which engages in the
MDU Business in any such area). Notwithstanding the foregoing, Executive shall
be free at any time following the Term of Employment to accept employment with
or provide other services to any Person whose business includes the MDU Business
but only if (i) the MDU Business is not the principal or predominant business of
such Person and (ii) the services of Executive do not principally or
predominantly relate to the MDU Business. By way of example only, if the Term of
Employment were to end on the date of this Agreement, Executive would be free to
be employed by a typical incumbent local exchange or long distance carrier or by
a typical franchised cable operator for so long as Executive's services did not
principally or predominantly relate to the provision of video and
telecommunications services to residential multiple dwelling units in the
markets in which the Company now operates or is actively planning to operate.
(b) During the Term of Employment and for a period of 12 months
thereafter, Executive shall not, directly or indirectly, (i) solicit any
customer of the Company or any Subsidiary to do business with any Person that
engages in the MDU Business or (ii) solicit any Person, other than his
secretary/administrative assistant, who is employed by the Company or any
Subsidiary or who was employed by the Company or any Subsidiary within 12 months
of such solicitation to (A) terminate his or her employment with the Company or
any Subsidiary, (B) accept employment with anyone other than the Company or any
Subsidiary or (C) in any manner interfere with the business of the Company or
any Subsidiary.
(c) Executive acknowledges that the Company has no adequate remedy
at law and would be irreparably harmed if Executive breaches or threatens to
breach any of the provisions of Section 12 or Section 13(a) or 13(b), and
therefore Executive agrees that the Company or any Subsidiary, as the case may
be, shall be entitled to temporary or permanent mandatory or injunctive relief
to terminate or forestall any breach or threatened breach of any of those
provisions and to specific performance of the terms of each of those provisions,
without the need to demonstrate irreparable injury or post bond or other
security. Executive further agrees that he shall not, in any proceeding seeking
injunctive or other equitable relief to enforce the provisions of Section 12 or
Section 13(a) or 13(b), raise the defense that the Company or any Subsidiary has
an adequate remedy at law. Nothing in this Section 13(c) shall be construed to
prohibit the Company or any Subsidiary from pursuing any other rights or
remedies available to it at law or in equity or which may be otherwise available
to it.
(d) If it is determined that any of the provisions of this Section
13, or any part thereof, is unenforceable because of the duration or
geographical scope of such provision, it is the intention of the Parties that
the duration or scope of such provision, as the case may be, shall be reduced so
that such provision becomes enforceable and, in its reduced form, such provision
shall then be enforceable and shall be enforced.
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14. Intellectual Property.
Any processes, inventions, ideas, know-how and other similar data
created or developed by Executive while employed by the Company which relate to
the business then conducted by the Company or any of its Subsidiaries shall be
the Company's exclusive and absolute property, and Executive hereby assigns to
the Company, now and hereafter, all of his right, title and interest to any and
all of the same. Any work in connection with the services rendered by Executive
hereunder shall be considered "work made for hire" under the Copyright Law of
1976 or any successor law, and the Company shall be the owner of such work as if
the Company were the author of such work.
15. Documents; Conduct; References.
(a) Executive hereby expressly covenants and agrees that,
following termination of the Term of Employment for any reason, or any time,
upon the Company's request, Executive will promptly return to the Company all
property of the Company and its Subsidiaries in his or her possession or control
(whether maintained at his or her office, home or elsewhere), including, without
limitation, all copies of all management studies, business or strategic plans,
budgets, notebooks and other printed, typed electronically stored or written
materials, documents, diaries, disks, calendars and data of or relating to the
Company or its Subsidiaries or their respective personnel or affairs.
(b) Executive hereby expressly covenants and agrees that Executive
will not at any time, during or after the Term of Employment, publicly
denigrate, ridicule or intentionally criticize the Company or any of its
Subsidiaries or any of their respective products or services, properties,
employees, officers or directors, including, without limitation, by way of news
interviews or the expression of personal view, opinions or judgments to the news
media.
(c) The Company hereby expressly covenants and agrees that the
Company will not at any time, during or after the Term of Employment, publicly
denigrate, ridicule or intentionally criticize Executive, including, without
limitation, by way of news interviews or the expression of personal views,
opinions or judgments to the news media.
(d) The Company hereby expressly covenants and agrees that,
following the Term of Employment, the Company will, unless otherwise requested
by Executive in any instance or required by law, provide to any prospective
employer seeking information regarding Executive's employment with the Company a
neutral reference in accordance with the general policies of the Company
applicable to requests for employment references.
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16. Acknowledgment of Representation by Counsel.
The Parties acknowledge that they have been represented by counsel
or knowingly waive their right to be represented by counsel with regard to this
Agreement and the subject matter hereof. Each Party agrees and acknowledges that
he or it has not relied upon any tax advice, legal counsel or business advice
provided by the other Party.
17. Assignability; Binding Nature.
This Agreement shall be binding upon and inure to the benefit of
the Parties and their respective successors, heirs (in the case of Executive)
and assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company, except that such rights or obligations
may be assigned or transferred pursuant to a merger or consolidation in which
the Company is not the surviving corporation, or the sale or liquidation of all
or substantially all of the assets of the Company, provided that the assignee or
transferee is the successor to all or substantially all of the assets of the
Company and such assignee or transferee assumes the liabilities, obligations and
duties of the Company, as contained in this Agreement, either contractually or
by operation of law. The Company further agrees that, in the event of a sale of
assets or liquidation as described in the preceding sentence, it shall take
whatever action it legally can in order to cause such assignee or transferee to
expressly assume the liabilities, obligations and duties of the Company
hereunder. No rights or obligations of Executive under this Agreement may be
assigned or transferred by Executive other than Executive's rights to
compensation and benefits.
18. Entire Agreement.
Except as herein otherwise expressly provided, this Agreement
contains the entire understanding and agreement between the Parties concerning
the subject matter hereof and supersedes all prior agreements, understandings,
discussions, negotiations and undertakings, whether written or oral, between the
Parties with respect thereto, including any agreement between Executive and any
Affiliate of the Company dated prior to the date hereof.
19. Amendment or Waiver.
No provision in this Agreement may be amended unless such
amendment is agreed to in writing and signed by Executive and an authorized
officer of the Company. No waiver by either Party of any breach by the other
Party of any condition or provision contained in this Agreement to be performed
by such other Party shall be deemed a waiver of a similar or dissimilar
condition or provision at the same or any prior or subsequent time. Any waiver
must be in writing and signed by Executive or an authorized officer of the
Company, as the case may be.
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20. Severability.
In the event that any provision or portion of any provision of
this Agreement shall be determined to be invalid or unenforceable for any
reason, in whole or in part, the remaining provisions and portions remaining of
any provisions of this Agreement shall be unaffected thereby and shall remain in
full force and effect to the fullest extent permitted by law.
21. Beneficiaries/References.
Executive shall be entitled to select (and change, to the extent
permitted under any applicable law) a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following Executive's death by
giving the Company written notice thereof. In the event of Executive's death or
a judicial determination of Executive's incompetence, reference in this
Agreement to Executive shall be deemed, where appropriate, to refer to his
beneficiary, estate or other legal representative.
22. Governing Law/Jurisdiction.
This Agreement shall be governed by and construed and interpreted
in accordance with the laws of the State of Texas without reference to
principles of conflict of laws.
23. Resolution of Disputes.
Any disputes arising under or in connection with this Agreement
shall be resolved by binding arbitration before a single arbitrator, to be held
in Dallas, Texas, in accordance with the rules and procedures of the American
Arbitration Association. Judgment upon the award rendered by the arbitrator
shall be final and subject to appeal only to the extent permitted by law. Each
Party shall bear its or his own expenses incurred in connection with any
arbitration. Anything to the contrary notwithstanding, each Party has the right
to proceed with a court action for injunctive relief or relief from violations
of law not within the jurisdiction of an arbitrator.
24. Notices.
Any notice required or permitted hereunder to be given to a Party
shall be effective only if given in writing and shall be deemed to have been
given when delivered personally or sent by certified or registered mail, postage
prepaid, return receipt requested or by Federal Express or other similar
service, duly addressed to the Party concerned at the address indicated below or
to such changed address as such Party may hereafter specify by notice to the
other Party:
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If to the Company:
OpTel, Inc.
0000 X. Xxxxxxxxxxx Xxxx, #0000
Xxxxxx, Xxxxx 00000
Attention: General Counsel
If to Executive:
000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
25. Headings.
The captions or headings of the sections contained in this
Agreement are for convenience only and shall not be deemed to control or affect
the meaning or construction of any provision of this Agreement.
26. Execution of Agreement and Further Actions.
This Agreement may be executed in several counterpart copies each
of which shall constitute an original and the same instrument notwithstanding
that both Parties are not signatories to the same counterpart. The Parties agree
to execute such other documents and to take such other action as may from time
to time be necessary or appropriate to carry out the intent of this Agreement,
provided that the same are not inconsistent with the provisions hereof.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
OPTEL, INC.
By:
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XXXX X. XXXX
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