Exhibit 10.5
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT (this
“Agreement”) is made and entered into April 28,
2008 (the “Effective Date”), by and between Sprint
Nextel Corporation, a Kansas corporation (the
“Company”) on behalf of itself and any of its
subsidiaries, affiliates and related entities, and Steven L. Elfman
(the “Executive”) (the Company and the Executive,
collectively, the “Parties,” and each, a
“Party”). Certain capitalized terms are defined in
Section 29.
WITNESSETH
:
WHEREAS, the Company desires to
employ the Executive as President - Network Operations and
Wholesale and the Executive desires to accept such
employment,;
WHEREAS, the Executive and the
Company desire to enter into this Agreement; and
NOW, THEREFORE, in consideration of
the premises and of the covenants and agreements set forth herein
and for other good and valuable consideration, the sufficiency and
receipt of which are hereby acknowledged, the Company and the
Executive agree as follows:
1. Employment .
(a) The Company will employ the
Executive and the Executive will be employed by the Company upon
the terms and conditions set forth herein.
(b) The employment relationship
between the Company and the Executive shall be governed by the
general employment policies and practices of the Company, including
without limitation, those relating to the Company’s Code of
Conduct, confidential information and avoidance of conflicts,
except that when the terms of this Agreement differ from or are in
conflict with the Company’s general employment policies or
practices, this Agreement shall control.
2. Term . Subject to
termination under Section 9, the Executive’s employment
shall be for an initial term of 24 months commencing on the
Effective Date and shall continue through the second anniversary of
the Effective Date (the “Initial Employment Term”). At
the end of the Initial Employment Term and on each succeeding
anniversary of the Effective Date, the Employment Term will be
automatically extended by an additional 12 months (each, a
“Renewal Term”), unless not less than 12 months prior
to the end of the Initial Employment Term or any Renewal Term,
either the Executive or the Company has given the other written
notice (in accordance with Section 20) of nonrenewal. The
Executive shall provide the Company with written notice of his
intent to terminate employment with the Company at least 30 days
prior to the effective date of such termination.
3. Position and Duties of the
Executive .
(a) The Executive shall serve as
President of Network Operations and Wholesale, and agrees to serve
as an officer of any enterprise and/or agrees to be an employee of
any Subsidiary as may be requested from time to time by the Board
of Directors of the Company (the “Board”), any
committee or person delegated by the Board or the Chief Executive
Officer of
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the Company (the “Chief Executive
Officer”). In such capacity, the Executive shall report
directly to the Chief Executive Officer of the Company or such
other officer of the Company as may be designated by the Chief
Executive Officer. The Executive shall have such duties,
responsibility and authority as may be assigned to the Executive
from time to time by the Chief Executive Officer, the Board or such
other officer of the Company as may be designated by the Chief
Executive Officer or the Board.
(b) During the Employment Term, the
Executive shall, except as may from time to time be otherwise
agreed to in writing by the Company, during reasonable vacations
(as set forth in Section 7 hereof) and authorized leave and
except as may from time to time otherwise be permitted pursuant to
Section 3(c), devote his best efforts, full attention and
energies during his normal working time to the business of the
Company, any duties as may be delineated in the Company’s
Bylaws for the Executive’s position and title and such other
related duties and responsibilities as may from time to time be
reasonably prescribed by the Board, any committee or person
designated by the Board, or the Chief Executive Officer, in each
case, within the framework of the Company’s policies and
objectives.
(c) During the Employment Term, and
provided that such activities do not contravene the provisions of
Section 3(a) or Sections 10, 11, 12 or 13 hereof and,
provided further , the Executive does not engage in any
other substantial business activity for gain, profit or other
pecuniary advantage which materially interferes with the
performance of his duties hereunder, the Executive may participate
in any governmental, educational, charitable or other community
affairs and, subject to the prior approval of the Chief Executive
Officer serve as a member of the governing board of any such
organization or any private or public for-profit company. The
Executive may retain all fees and other compensation from any such
service, and the Company shall not reduce his compensation by the
amount of such fees.
4. Compensation .
(a) Base Salary . During the
Employment Term, the Company shall pay to the Executive an annual
base salary of $650,000 (the “Base Salary”), which Base
Salary shall be payable at the times and in the manner consistent
with the Company’s general policies regarding compensation of
the Company’s senior executives. The Base Salary will be
reviewed periodically by the Chief Executive Officer and may be
increased (but not decreased, except for across-the-board
reductions generally applicable to the Company’s senior
executives) from time to time in the Chief Executive
Officer’s sole discretion.
(b) Incentive Compensation .
The Executive will be eligible to participate in any short-term and
long-term incentive compensation plans, annual bonus plans and such
other management incentive programs or arrangements of the Company
approved by the Board that are generally available to the
Company’s senior executives, including, but not limited to,
the STIP and the LTSIP. Incentive compensation shall be paid in
accordance with the terms and conditions of the applicable plans,
programs and arrangements.
(i) Annual Performance Bonus
. During the Employment Term, the Executive shall be entitled to
participate in the STIP, with such opportunities as may be
determined by the Chief Executive Officer in his sole
discretion
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(“Target Bonuses”), and
as may be increased (but not decreased, except for across-the-board
reductions generally applicable to the Company’s senior
executives) from time to time, and the Executive shall be entitled
to receive full payment of any award under the STIP, determined
pursuant to the STIP (a “Bonus Award”).
(ii) Long-Term Performance
Bonus . During the Employment Term, the Executive shall be
entitled to participate in the LTSIP with such opportunities, if
any, as may be determined by the Chief Executive Officer
(“LTSIP Target Award Opportunities”).
(iii) Incentive bonuses, if earned,
shall be paid when incentive compensation is customarily paid to
the Company’s senior executives in accordance with the terms
of the applicable plans, programs or arrangements.
(iv) Pursuant to the Company’s
applicable incentive or bonus plans as in effect from time to time,
the Executive’s incentive compensation during the term of
this Agreement may be determined according to criteria intended to
qualify as performance-based compensation under Section 162(m)
of the Code.
(c) Equity Compensation . The
Executive shall be eligible to participate in such equity incentive
compensation plans and programs as the Company generally provides
to its senior executives, including, but not limited to, the LTSIP.
During the Employment Term, the Compensation Committee may, in its
sole discretion, grant equity awards to the Executive, which would
be subject to the terms of the respective award agreements
evidencing such grants and the applicable plan or
program.
(i) Sign-on Option Award .
The Compensation Committee hereby authorizes the grant to the
Executive, as of the Effective Date, of an option right (“the
Sign-On Option Award”) to purchase 435,730 shares of Common
Stock at an option price equal to 120% of the Market Value Per
Share on the Date of Grant. The Sign-On Option Award will be
subject to the terms and conditions of the option agreement
attached hereto as Exhibit A. Subject to the terms and conditions
of the option agreement, the Sign-On Option Award shall vest on the
second anniversary of the Date of Grant. Except as otherwise
provided in the Executive’s award agreement evidencing the
Sign-On Option Award, the Sign-On Option Award will be governed by
provisions of the LTSIP.
(ii) Sign-On RSU Award . On
the effective date the Compensation Committee will grant to the
Executive 129,032 restricted stock units (the “Sign-On RSU
Award”). The Sign-On RSU Award will be subject to the terms
and conditions of the restricted stock award agreement evidencing
such grant attached here to as Exhibit B and shall vest on the
second anniversary of the Date of Grant. Except as otherwise
provided in the Executive’s award agreement evidencing the
Sign-On RSU Award, the Sign-On RSU Award will be governed by
provisions of the LTSIP.
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(iii) 2008 LTSIP. Subject to
approval by the Compensation Committee, the Executive will be
eligible to participate in the 2008 LTSIP at a target award of
$3,000,000.
5. Benefits .
(a) During the Employment Term, the
Company shall make available to the Executive, subject to the terms
and conditions of the applicable plans, participation for the
Executive and his eligible dependents in:
(i) Company-sponsored group health, major medical, dental,
vision, pension and profit sharing, 401(k) and employee welfare
benefit plans, programs and arrangements (the “Employee
Plans”) and such other usual and customary benefits in which
senior executives of the Company participate from time to time, and
(ii) such fringe benefits and perquisites as may be made
available to senior executives of the Company as a
group.
(b) The Executive acknowledges that
the Company may change its benefit programs from time to time which
may result in certain benefit programs being amended or terminated
for its senior executives generally.
6. Expenses . The Company
shall pay or reimburse the Executive for reasonable and necessary
business expenses incurred by the Executive in connection with his
duties on behalf of the Company in accordance with the
Company’s Enterprise Financial Services—Employee Travel
and Expense Policy, as may be amended from time to time, or any
successor policy, plan program or arrangement thereto and any other
of its expense policies applicable to senior executives of the
Company, following submission by the Executive of reimbursement
expense forms in a form consistent with such expense policies. Any
reimbursement or provision of in-kind benefits made during the
Executive’s lifetime pursuant to the terms of this
Section 6 shall be made not later than December 31st of
the year following the year in which the Executive incurs the
expense; provided , however , that in no event will
the amount of expenses so reimbursed, or in-kind benefits provided,
by the Company in one year affect the amount of expenses eligible
for reimbursement, or in-kind benefits to be provided, in any other
taxable year. Each provision of reimbursement of expenses or
in-kind benefit pursuant to this Section 6 shall be considered
a separate payment and not one of a series of payments for purposes
of Section 409A of the Code.
7. Vacation . In addition to
such holidays, sick leave, personal leave and other paid leave as
is allowed under the Company’s policies applicable to senior
executives generally, the Executive shall be entitled to
participate in the Company’s vacation policy in accordance
with the Company’s policy generally applicable to senior
executives. The duration of such vacations and the time or times
when they shall be taken will be determined by the Executive in
consultation with the Company.
8. Place of Performance . In
connection with his employment by the Company, the Executive shall
be based at the principal executive offices of the Company in the
vicinity of Overland Park, Kansas (the “Place of
Performance”), except for travel reasonably required for
Company business. If the Company relocates the Executive’s
place of work more than 50 miles from his place of work prior to
such relocation, the Executive shall relocate to a residence within
(a) 50 miles of such relocated executive offices or
(b) such total miles that does not exceed the
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total number of miles the Executive commuted to
his place of work prior to relocation of the Executive’s
place of work. To the extent the Executive relocates his residence
as provided in this Section 8, the Company will pay or
reimburse the Executive’s relocation expenses in accordance
with the Company’s relocation policy applicable to senior
executives. Any reimbursement or provision of in-kind benefits made
during the Executive’s lifetime pursuant to the terms of this
Section 8 shall be made not later than December 31st of
the year following the year in which the Executive incurs the
expense. In no event will the amount of expenses so reimbursed, or
in-kind benefits provided, by the Company in one year affect the
amount of expenses eligible for reimbursement, or in-kind benefits
to be provided, in any other taxable year. Each provision of
reimbursement of expenses or in-kind benefit pursuant to this
Section 8 shall be considered a separate payment and not one
of a series of payments for purposes of Section 409A of the
Code.
9. Termination .
(a) Termination by the Company
for Cause or Resignation by the Executive Without Good Reason .
If, during the Employment Term, the Executive’s employment is
terminated by the Company for Cause, or if the Executive resigns
without Good Reason, the Executive shall not be eligible to receive
Base Salary or to participate in any Employee Plans with respect to
future periods after the date of such termination or resignation
except for the right to receive accrued but unpaid cash
compensation and vested benefits under any Employee Plan in
accordance with the terms of such Employee Plan and applicable
law.
(b) Termination by the Company
Without Cause or Resignation by the Executive for Good Reason
outside of the CIC Severance Protection Period . If, during the
Employment Term, the Executive’s employment is terminated by
the Company without Cause or the Executive terminates for Good
Reason prior to or following expiration of the CIC Severance
Protection Period, the Executive shall be entitled to receive from
the Company: (1) the Executive’s accrued, but unpaid,
Base Salary through the date of termination of employment, payable
in accordance with the Company’s normal payroll practices,
and (2) conditioned upon the Executive delivering to the
Company a release in a form reasonably satisfactory to the Company
(the “Release”) within 21 days after termination of the
Executive’s employment, with all periods for revocation
expired (the “Release Effective Date”), in full
satisfaction of the Executive’s rights and any benefits the
Executive might be entitled to under the Separation Plan and this
Agreement, unless otherwise specified, during the Payment Period,
the Executive shall be entitled to:
(i) receive from the Company
periodic payments equal to his Base Salary in effect prior to the
termination of his employment, which payments shall be paid to the
Executive in equal installments on the regular payroll dates under
the Company’s payroll practices applicable to the Executive
at the time of termination for the duration of the Payment Period,
and each such payment shall be a separate payment and not one of a
series of payments for purposes of Section 409A of the
Code;
(ii) (A) receive a pro rata payment
of the Bonus Award for the portion of the Company’s fiscal
year prior to the date of termination of his
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employment; (B) receive a pro
rata payment of the Capped Bonus Award for the portion of the
Company’s fiscal year following the date of termination of
his employment; (C) receive for the next fiscal year following
the fiscal year during which termination of his employment occurs,
the Capped Bonus Award; and (D) receive payment of a pro rata
portion of the Capped Bonus Award for the second year following the
fiscal year during which the Executive’s employment
terminates (for purposes of this Section 9(b)(ii), any pro
rata payment shall be determined based on the methodology for
determining pro rated awards under the STIP, each such payment
shall be payable in accordance with the provisions of the STIP and
each such payment shall be regarded as a separate payment and not
one of a series of payments for purposes of Section 409A of
the Code); provided , however , that to the extent
the Executive’s employment is terminated for Good Reason due
to a reduction of the Executive’s Target Bonus, in accordance
with Section 29(x)(ii), the Executive’s Target Bonus for
the purposes of this Section 9(b)(ii) shall be the
Executive’s Target Bonus immediately prior to such
reduction
(iii) continued participation in the
Company’s group health plans at then-existing participation
and coverage levels for the number of months equal to the period of
continuation coverage the Executive would be entitled to pursuant
to Section 4980B of the Code, in accordance with
Section 409A of the Code, comparable to the terms in effect
from time to time for the Company’s senior executives,
including any co-payment and premium payment requirements and the
Company shall deduct for each payment payable to the Executive
pursuant to Section 9(b)(i), the amount of any employee
contributions necessary to maintain such coverage for such period,
except that (A) subject to Section 9(b)(iv), following
such period, the Executive shall retain any rights to continue
coverage under the Company’s group health plans under the
benefits continuation provisions pursuant to Section 4980B of
the Code by paying the applicable premiums of such plans;
(B) the Executive shall no longer be eligible to receive the
benefits otherwise receivable pursuant to this
Section 9(b)(iii) as of the date that the Executive becomes
eligible to receive comparable benefits from a new employer; and
(C) the Company will not provide for cash in lieu of benefits
under this Section 9(b)(iii);
(iv) continued participation at the
Executive’s sole cost in the Company’s group health
plans at then-existing participation and coverage levels for the
six-month period following the period of continuation coverage the
Executive would be entitled to, if any, pursuant to
Section 9(b)(iii) above, in accordance with Section 409A
of the Code, comparable to the terms in effect from time to time
for the Company’s senior executives, but only to the extent
that the Executive makes a payment to the Company in an amount
equal to the monthly premium payments (both the employee and
employer portions) required to maintain such comparable coverage on
or before the first day of each calendar month commencing with the
first calendar month of the six-month period following the period
of continuation coverage specified in Section 9(b)(iii), and
the Company shall reimburse the Executive, in accordance
with
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the terms of Section 6 hereof,
for the amount of such premiums, if any, in excess of any employee
contributions necessary to maintain such coverage and each payment
pursuant to this Section 9(b)(iv) shall be regarded as a
separate payment and not one of a series of payments for purposes
of Code Section 409A, except that (A) following such
period, the Executive shall retain any rights to continue coverage
under the Company’s group health plans under the benefits
continuation provisions pursuant to Section 4980B of the Code
by paying the applicable premiums of such plans; (B) the
Executive shall no longer be eligible to receive the benefits
otherwise receivable pursuant to this Section 9(b)(iv) as of
the date that the Executive becomes eligible to receive comparable
benefits from a new employer; and (C) the Company will not
provide for cash in lieu of benefits under this
Section 9(b)(iv);
(v) continued participation in the
Company’s employee life insurance plans at then-existing
participation and coverage levels for the 24 months following the
Release Effective Date, comparable to the terms in effect from time
to time for the Company’s senior executives, including any
co-payment and premium payment requirements and the Company shall
deduct for each payment payable to the Executive pursuant to
Section 9(b)(i), the amount of any employee contributions
necessary to maintain such coverage for such period, except that
(A) the Executive shall no longer be eligible to receive the
benefits otherwise receivable pursuant to this Section 9(b)(v)
as of the date that the Executive becomes eligible to receive
comparable benefits from a new employer; and (C) the Company
will not provide for cash in lieu of benefits under this
Section 9(b)(v); and
(vi) receive
outplacement services by a firm selected by the Company at its
expense in an amount not to exceed $35,000, and the Company will
not provide for cash in lieu of this benefit; provided ,
however , that all such outplacement services must be
completed, and all payments by the Company must be made, by
December 31 st of the second calendar year
following the calendar year in which the Executive’s
separation from service occurs.
Notwithstanding anything in this
Section 9(b) to the contrary, to the extent the Executive has
not signed the Release with all periods for revocation expired as
provided in this Section 9(b) and the Release, such
determination to be made at the conclusion of the applicable
revocation period, the Executive will forfeit any right to receive
the payments and benefits specified in this
Section 9(b).
(c) Termination by the Company
Without Cause or Resignation by the Executive for Good Reason
During the CIC Severance Protection Period . If prior to the
expiration of the Employment Term and during the CIC Severance
Protection Period, the Executive’s employment is terminated
by the Company without Cause or the Executive terminates his
employment for Good Reason, subject to the terms and conditions of
the CIC Severance Plan, the Executive shall be entitled to
severance compensation and benefits pursuant to the terms of the
CIC Severance Plan. To the extent that the Executive is not a
Participant in the CIC Severance Plan at the time of termination,
the Executive shall be entitled to severance compensation and
benefits pursuant to the terms of Section 9(b).
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(d) Termination by Death . If
the Executive dies during the Employment Term, the
Executive’s employment will terminate and the
Executive’s beneficiary or if none, the Executive’s
estate, shall be entitled to receive from the Company, the
Executive’s accrued, but unpaid Base Salary through the date
of termination of employment and any vested benefits under any
Employee Plan in accordance with the terms of such Employee Plan
and applicable law.
(e) Termination by Disability
. If the Executive becomes Disabled, prior to the expiration of the
Employment Term, the Executive’s employment will terminate
and the Executive shall be entitled to:
(i) receive periodic payments equal
to his Base Salary in effect prior to the termination of his
employment, which payments shall be paid to the Executive in equal
installments on the regular payroll dates under the Company’s
payroll practices applicable to the Executive at the time of
termination for 12 months (reduced by any amounts paid under a
long-term disability plan (“LTD Plan”) now or hereafter
sponsored by the Company (calculated on a monthly basis));
provided , however , that in the event that the
Executive is a “specified employee” (within the meaning
of Section 409A of the Code and determined in accordance with
procedures adopted by the Company), any such payments that
constitutes deferred compensation within the meaning of
Section 409A of the Code will not commence until earliest to
occur of (A) the first business day of the seventh month
following the date of the Executive’s “separation from
service” or (B) death, except that the Executive on such
date will be paid a lump-sum cash payment equal to the aggregate
amount of any such payments that constitutes deferred compensation
within the meaning of Section 409A of the Code that the
Executive would have been entitled to receive during the six-month
period following the Executive’s “separation from
service”, and the Executive shall receive the remaining
payments for six months payable in equal installments on the
regular payroll dates under the Company’s payroll practices
applicable to the Executive at the time of termination commencing
on the first business day of the seventh month following the date
of the Executive’s “separation from service,” as
specified in this Section 9(e)(i), and each payment pursuant
to this Section 9(e)(i) shall be regarded as a separate
payment and not one of a series of payments for purposes of Code
Section 409A; and
(ii) continued participation in the
Company’s group health plans at then-existing participation
and coverage levels for 12 months comparable to the terms in effect
from time to time for the Company’s senior executives,
including any co-payment and premium payment requirements;
provided , however , that the Company will not
provide for cash in lieu of these benefits under this
Section 9(e)(ii); provided further that if the Executive would
not be eligible for participation under the Company’s group
health plans but for this Section 9(e)(ii), such continued
participation will be at the Executive’s sole cost
and
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only to the extent the Executive
makes a payment to the Company in an amount equal to the monthly
premium payments (both the employee and employer portions) required
to maintain such comparable coverage on or before the first day of
each calendar month of such coverage, and the Company shall
reimburse the Executive, in accordance with the terms of
Section 6 hereof, for the amount of such premiums, and each
payment pursuant to this Section 9(e)(ii) shall be regarded as
a separate payment and not one of a series of payments for purposes
of Code Section 409A.
(f) No Mitigation Obligation
. No amounts paid under Section 9 will be reduced by any
earnings that the Executive may receive from any other source. The
Executive’s coverage under the Company’s medical,
dental, vision and employee life insurance plans will terminate as
of the date that the Executive is eligible for comparable benefits
from a new employer. The Executive shall notify the Company within
30 days after becoming eligible for coverage of any such
benefits.
(g) Forfeiture .
Notwithstanding the foregoing, any right of the Executive to
receive termination payments and benefits hereunder shall be
forfeited to the extent of any amounts payable after any breach of
Section 10, 11, 12, 13 or 15 by the Executive.
10. Confidential Information;
Statements to Third Parties .
(a) During the Employment Term and
on a permanent basis upon and following termination of the
Executive’s employment, the Executive acknowledges
that:
(i) all information, whether or not
reduced to writing (or in a form from which information can be
obtained, translated, or derived into reasonably usable form) or
maintained in the mind or memory of the Executive and whether
compiled or created by the Company, any of its Subsidiaries or any
affiliates of the Company or its Subsidiaries (collectively, the
“Company Group”), which derives independent economic
value from not being readily known to or ascertainable by proper
means by others who can obtain economic value from the disclosure
or use of such information, of a proprietary, private, secret or
confidential (including, without exception, inventions, products,
processes, methods, techniques, formulas, compositions, compounds,
projects, developments, sales strategies, plans, research data,
clinical data, financial data, personnel data, computer programs,
customer and supplier lists, trademarks, service marks, copyrights
(whether registered or unregistered), artwork, and contacts at or
knowledge of customers or prospective customers) nature concerning
the Company Group’s business, business relationships or
financial affairs (collectively, “Proprietary
Information”) shall be the exclusive property of the Company
Group.
(ii) the Proprietary Information of
the Company Group gained by the Executive during the
Executive’s association with the Company Group was or will be
developed by and/or for the Company Group through substantial
expenditure of time, effort and money and constitutes valuable and
unique property of the Company Group;
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(iii) reasonable efforts have been
put forth by the Company Group to maintain the secrecy of its
Proprietary Information;
(iv) such Proprietary Information is
and will remain the sole property of the Company Group;
and
(v) any retention or use by the
Executive of Proprietary Information after the termination of the
Executive’s services for the Company Group will constitute a
misappropriation of the Company Group’s Proprietary
Information.
(b) The Executive further
acknowledges and agrees that he will take all affirmative steps
reasonably necessary or required by the Company to protect the
Proprietary Information from inappropriate disclosure during and
after his employment with the Company.
(c) The Executive further agrees
that all files, letters, memoranda, reports, records, data,
sketches, drawings, laboratory notebooks, program listings, or
other written, photographic, electronic, or other tangible material
containing or constituting Proprietary Information, whether created
by the Executive or others, which shall come into his custody or
possession, regardless of medium, shall be and are the exclusive
property of the Company to be used by him/her only in the
performance of his duties for the Company. All such materials or
copies thereof and all tangible things and other property of the
Company Group in the Executive’s custody or possession shall
be delivered to the Company (to the extent the Executive has not
already returned) in good condition, on or before five business
days subsequent to the earlier of: (i) a request by the
Company or (ii) the Executive’s termination of
employment for any reason or Cause, including for nonrenewal of
this Agreement, Disability, termination by the Company or
termination by the Executive. After such delivery, the Executive
shall not retain any such materials or portions or copies thereof
or any such tangible things and other property and shall execute
any statements or affirmations of compliance under oath that the
Company may require.
(d) The Executive further agrees
that his obligation not to disclose or to use information and
materials of the types set forth in Sections 10(a), 10(b) and 10(c)
above, and his obligation to return materials and tangible
property, set forth in Section 10(c) above, also extends to
such types of information, materials and tangible property of
customers of the Company Group, consultants for the Company Group,
suppliers to the Company Group, or other third parties who may have
disclosed or entrusted the same to the Company Group or to the
Executive.
(e) The Executive further
acknowledges and agrees that he will continue to keep in strict
confidence, and will not, directly or indirectly, at any time,
disclose, furnish, disseminate, make available, use or suffer to be
used in any manner any Proprietary Information of the Company Group
without limitation as to when or how the Executive may have
acquired such Proprietary Information and that he will not disclose
any Proprietary Information to any person or entity other than
appropriate employees of the Company or use the same for any
purposes (other than in the performance of his duties as an
employee of the Company) without written approval of the Board,
either during or after his employment with the Company.
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(f) Further the Executive
acknowledges that his obligation of confidentiality will survive,
regardless of any other breach of this Agreement or any other
agreement, by any party hereto, until and unless such Proprietary
Information of the Company Group has become, through no fault of
the Executive, generally known to the public. In the event that the
Executive is required by law, regulation, or court order to
disclose any of the Company Group’s Proprietary Information,
the Executive will promptly notify the Company prior to making any
such disclosure to facilitate the Company seeking a protective
order or other appropriate remedy from the proper authority. The
Executive further agrees to cooperate with the Company in seeking
such order or other remedy and that, if the Company is not
successful in precluding the requesting legal body from requiring
the disclosure of the Proprietary Information, the Executive will
furnish only that portion of the Proprietary Information that is
legally required, and the Executive will exercise all legal efforts
to obtain reliable assurances that confidential treatment will be
accorded to the Proprietary Information.
(g) The Executive’s
obligations under this Section 10 are in addition to, and not
in limitation of, all other obligations of confidentiality under
the Company’s policies, general legal or equitable principles
or statutes.
(h) During the Employment Term and
following his termination of employment:
(i) the Executive shall not,
directly or indirectly, make or cause to be made any statements,
including but not limited to, comments in books or printed media,
to any third parties criticizing or disparaging the Company Group
or commenting on the character or business reputation of the
Company Group. Without the prior written consent of the Board,
unless otherwise required by law, the Executive shall not
(A) publicly comment in a manner adverse to the Company Group
concerning the status, plans or prospects of the business of the
Company Group or (B) publicly comment in a manner adverse to
the Company Group concerning the status, plans or prospects of any
existing, threatened or potential claims or litigation involving
the Company Group;
(ii) the Company shall comply with
its policies regarding public statements with respect to the
Executive and any such statements shall be deemed to be made by the
Company only if made or authorized by a member of the Board or a
senior executive officer of the Company; and
(iii) nothing herein precludes
honest and good faith reporting by the Executive to appropriate
Company or legal enforcement authorities.
(i) The Executive acknowledges and
agrees that a violation of the foregoing provisions of this
Section 10 would cause irreparable harm to the Company Group,
and that the Company’s remedy at law for any such violation
would be inadequate. In recognition of the foregoing, the Executive
agrees that, in addition to any other relief afforded by law or
this
11
Agreement, including damages sustained by a
breach of this Agreement and any forfeitures under
Section 9(g), and without the necessity or proof of actual
damages, the Company shall have the right to enforce this Agreement
by specific remedies, which shall include, among other things,
temporary and permanent injunctions, it being the understanding of
the undersigned parties hereto that damages, the forfeitures
described above and injunctions shall all be proper modes of relief
and are not to be considered as alternative remedies.
11. Non-Competition . In
consideration of the Company entering into this Agreement, for a
period commencing on the Effective Date and ending on the
expiration of the Restricted Period:
(a) The Executive covenants and
agrees that the Executive will not, directly or indirectly, engage
in any activities on behalf of or have an interest in any
Competitor of the Company Group, whether as an owner, investor,
executive, manager, employee, independent consultant, contractor,
advisor, or otherwise. The Executive’s ownership of less than
one percent (1%) of any class of stock in a publicly traded
corporation shall not be a breach of this paragraph.
(b) A “Competitor” is
any entity doing business directly or indirectly (e.g., as an
owner, investor, provider of capital or otherwise) in the United
States including any territory of the United States (the
“Territory”) that provides products and/or services
that are the same or similar to the products and/or services that
are currently being provided at the time of Executive’s
termination or that were provided by the Company Group during the
two-year period prior to the Executive’s separation from
service with the Company Group.
(c) The Executive acknowledges and
agrees that due to the continually evolving nature of the Company
Group’s industry, the scope of
