Exhibit 10.19
FORM OF
CONSULTING
AGREEMENT
This Consulting Agreement (“
Agreement ”), dated as of __________, 2009, is
by and between Grande Communications Networks LLC, a Delaware
limited liability company and successor-in-interest to Grande
Communications Networks, Inc. (the “ Company
”), and Roy H. Chestnutt (“ Chestnutt
”). In the event the Transaction (as defined
herein) is not consummated, this Agreement shall be null and
void.
RECITALS
WHEREAS , this Agreement shall become effective
contemporaneously with the consummation of the Transaction (the
“ Effective Time ”); the transactions
contemplated by the Recapitalization Agreement dated as of August
27, 2009, by and among ABRY Partners VI, L.P., Grande
Communications Networks, Inc., Grande Communications Holdings,
Inc., ABRY Partners, LLC, Grande Investment L.P., and Grande Parent
LLC are referred to as the “ Transaction
”;
WHEREAS , Chestnutt has served as Chief Executive
Officer of Grande Communications Networks, Inc., pursuant to the
terms of an Employment Agreement, effective as of December 31,
2005, as amended (the “ Employment Agreement
”);
WHEREAS , the Company will terminate Chestnutt’s
employment relationship at the Effective Time;
WHEREAS , after termination of such employment
relationship, the Company desires to engage the service of
Chestnutt as a consultant and Chestnutt desires to accept such
engagement upon the terms and conditions hereinafter set forth;
and
NOW, THEREFORE , in consideration of the foregoing premises and
the mutual covenants herein contained, and intending to be legally
bound hereby, the parties hereto agree as follows:
1.
Termination and
Consulting Services .
(a)
The Company and Chestnutt
acknowledge and agree that Chestnutt’s employment with the
Company is terminated by the Company without Cause (as defined in
the Employment Agreement) at the Effective Time pursuant to Section
10(b)(2) of the Employment Agreement. As a result, the
Company acknowledges and agrees that upon the Effective Time it
will be obligated to commence Severance Pay and Benefit
Continuation (as such terms are defined in the Employment
Agreement) to Chestnutt pursuant to Section 10(b)(5) of the
Employment Agreement.
(b)
From the day following the Effective
Time until the 180th day following the Effective Time (such 180th
day, the “ Consulting End Date ”, and
such period, the “ Consulting Services Period
”), Chestnutt shall render such consulting services (the
“ Services ”) to the Company as may
reasonably be requested by the Company from time to
time. Notwithstanding anything to the contrary in this
Agreement, the parties intend that the average level of bona fide
services to be provided by Chestnutt during the Consulting Services
Period shall be equal to or less than 20% of the average level of
the bona fide services provided by Chestnutt during the 36-month
period immediately preceding the Effective
Time. Chestnutt shall not incur any travel or other
expenses in performing the Services unless approved in advance by
the Chief Executive Officer of the Company. Chestnutt
may engage in other services, employment or occupation during the
Consulting Services Period as long as such services, employment or
occupation are not contrary to the provisions of this Agreement and
do not materially interfere with his duties and obligations
hereunder. Chestnutt shall comply with all applicable
laws in providing Services and shall provide such Services in
accordance with industry standards.
2.
Payment . As consideration for the provision
of the Services in accordance with this Agreement, a lump sum of
$112,500 (less payroll taxes and other applicable withholdings and
deductions) (the “ Consulting Bonus ”)
will be payable to Chestnutt in accordance with and subject to the
terms and conditions of this Section 2 . Payment
of the Consulting Bonus under this Section 2 is subject to
execution and delivery of a release executed by Chestnutt on or
after the Consulting End Date on a form prepared by the Company
(the “ Release ”). The Consulting Bonus
will be paid to Chestnutt in a single payment within ten (10)
business days following the eighth (8th) day after Chestnutt signs
and delivers the Release; provided that if Chestnutt revokes the
Release within such eight (8) day period or does not execute and
deliver the Release to the Company within thirty (30) business days
after the Consulting End Date, Chestnutt will not be entitled to
any Consulting Bonus under this
Agreement. Notwithstanding anything in this Agreement to
the contrary, the Company shall have no obligation to make any
payment under this Agreement if (1) Chestnutt is in material breach
of Section 11 of the Employment Agreement; (2) the Company
terminates this Agreement for Cause, or (3) Chestnutt is no longer
available to perform Services prior to the Consulting End Date due
to his death or Disability. For purposes of this
Agreement, “ Cause ” shall mean (i) the
commission by Chestnutt of a felony or a crime involving moral
turpitude or the commission of any other act involving dishonesty,
disloyalty or fraud, (ii) conduct by Chestnutt tending to bring the
Company into substantial public disgrace or disrepute, (iii)
failure of Chestnutt to perform (in any material respect) his
obligations under this Agreement or the reasonable directives of
the Chief Executive Officer or the Board, provided, that the Chief
Executive Officer or the Board shall give Chestnutt notice of such
failure and Chestnutt shall have thirty (30) days to cure such
failure, which if such failure is not cured during said thirty (30)
day period, the Company shall have the immediate right to terminate
the Services under this Agreement; (iv) gross negligence or willful
misconduct by Chestnutt in providing the Services; or (v) any
substance abuse of Chestnutt in any manner interferes with the
performance of the Services. For purposes of this
Agreement, “ Disability ” shall mean
Chestnutt has become mentally or physically incapacitated to the
extent that he is unable to perform the Services under this
Agreement for a period of three (3) months, as determined by the
Company following consultation with and th
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