Exhibit 10.3
AGREEMENT REGARDING SPECIAL
COMPENSATION
AND POST EMPLOYMENT RESTRICTIVE
COVENANTS
THIS AGREEMENT made
this 12 th day of December, 1995, by and
between SPRINT CORPORATION, a Kansas corporation
(“Sprint”), (Sprint, and the subsidiaries of Sprint are
collectively referred to herein as “Employer”), and
DENNIS G. HUBER (“Executive”).
W I T N E S S E T
H:
WHEREAS, Employer is 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 Vice President Network Service
Delivery;
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 are 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 all 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, Executive (a) shall be awarded an
option to purchase 12,000 shares of common stock as set forth in a
stock option agreement of even-date herewith, attached hereto and
incorporated herein (the “Stock Option Agreement”) or,
if Executive so elects, in lieu of the option to purchase shares,
3,000 shares of restricted stock to be granted after Sprint’s
spin-off of its cellular division, the number of shares being
subject to adjustment to maintain the pre-spin-off value of the
grant, all as set forth in a restricted stock agreement of
even-date herewith, attached hereto and incorporated herein
(“Restricted Stock Agreement”) and (b) shall be
entitled to the Special Compensation set forth in Section 5
hereof in accordance with the terms of this Agreement.
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, except as
noted in Section 17. 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 entitle
Executive:
(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) to an acceleration of vesting of
stock options or restricted stock in accordance with the relevant
provisions of the Stock Option Agreement or 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) to receive 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
reemployed by Employer or an affiliate or Executive breaches his
Confidential Information Covenant (as defined in Section 11
hereof), or breaches Section 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.
Termination for failure to meet
performance expectations, unless willful, continuing and
substantial, shall not be deemed a Termination for Cause. 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
occurren
