Exhibit 10.25
EMPLOYMENT
AGREEMENT
EMPLOYMENT AGREEMENT (the “
Agreement ”), dated as of May 6, 2009, and
effective as of February 4, 2008 (the “ Closing
Date ”), by and among Intelsat Global, Ltd. (formerly
known as Serafina Holdings Limited, referred to as the “
Parent ”), a Bermuda exempted company, Intelsat, Ltd.
(the “ Company ”), and Phillip L. Spector (the
“ Executive ”), a resident of the State of
Florida.
WHEREAS, the Executive is currently
employed by the Company under the terms and conditions of an
employment agreement dated January 31, 2005 (as amended
June 21, 2005, March 8, 2006, March 16,
2007 and December 29, 2008 the “ Previous Employment
Agreement ”); and
WHEREAS, pursuant to the
transactions contemplated by the Share Purchase Agreement among the
Company, Intelsat Holdings, Ltd. (Bermuda), the Parent, and
Serafina Acquisition Limited (Bermuda) as of June 19, 2007
(the “ Share Purchase Agreement ”), the Company
became a wholly owned subsidiary of the Parent on the Closing Date;
and
WHEREAS, the Company desires to
continue to employ the Executive on a full-time basis and the
Executive desires to continue to be so employed by the Company on
the terms and conditions set forth below.
NOW, THEREFORE, in consideration of
the premises and mutual covenants contained herein (including,
without limitation, the Company’s employment of the Executive
and the advantages and benefits thereby inuring to the Executive)
and for other good and valuable consideration, the receipt,
adequacy and sufficiency of which are hereby acknowledged by each
party hereto, the parties hereby agree as follows:
1. Effectiveness of Agreement and
Employment of the Executive .
1.1 Effectiveness of
Agreement . This Agreement shall be effective as of the Closing
Date (the “ Effective Date ”).
1.2 Employment by the Company
.
(a) Position and Duties .
During the Employment Period (as defined in Section 3 hereof),
the Executive shall serve as the Executive Vice President and
General Counsel of the Parent and the Company. In this capacity,
the Executive shall have the duties, authorities and
responsibilities commensurate with the duties, authorities and
responsibilities of persons in similar capacities in similarly
sized companies, and such other duties, authorities and
responsibilities as the Company’s Chief Executive Officer
(the “ CEO ”) shall designate from time to time
that are not inconsistent with the Executive’s position as
Executive Vice President and General Counsel. The Executive shall
be the Executive Vice President and General Counsel of the
Parent’s entire group of businesses, including without
limitation any business that may become part of or affiliated with
such group as a result of future mergers, acquisitions or similar
transactions by or with the Parent, but excluding Intelsat General
Corporation. The Executive acknowledges that he shall be required
to travel on business in connection with the performance
of his duties hereunder. The Executive shall
directly and exclusively report to the CEO, and perform such duties
and services for, the Parent, the Company and the Company’s
subsidiaries and affiliates (such subsidiaries and affiliates,
including any company in which the Company may not have control but
has an equity or debt investment) collectively, “
Affiliates ”) as may be designated from time to time
by the Company’s Board of Directors (the “ Board
”) or the CEO. The Executive also agrees to serve, without
additional compensation, as the Executive Vice President and
General Counsel of any Affiliate if so requested by the Board or
the CEO.
(b) Permissible Activities .
During the Employment Period, the Executive shall devote all of his
business time and attention to his employment under this Agreement;
provided , however , that, subject to the provisions
of Sections 5.1 and 5.3, the Executive may: (i) serve as a
non-executive director on the boards of directors of not more than
two for-profit companies (other than the Company and its
Affiliates) during the Employment Period, unless the Executive
obtains the prior written consent of the Company to serve as a
non-executive director on any other board of directors,
(ii) serve on the boards of directors of non-profit
organizations, (iii) participate in charitable, civic,
educational, professional, community or industry affairs, and
(iv) manage the Executive’s passive personal
investments, so long as such activities, individually or in the
aggregate, do not interfere or conflict with the Executive’s
duties hereunder or create a potential business or fiduciary
conflict.
1.3 Location . During the
Employment Period, the Executive’s principal place of
employment shall be at the Company’s offices in Washington,
D.C. and Florida except for necessary travel on the Company’s
business; provided , however , that it is the
parties’ current intention that the Executive will spend an
appropriate amount of time working at the Company’s
headquarters, currently located in Bermuda, in order to fulfill his
duties.
2. Compensation and Benefits
.
2.1 (a) Salary . During the
Employment Period, the Company shall pay the Executive for services
during his employment under this Agreement a base salary of no less
than the annual rate at five hundred and fifteen thousand dollars
($515,000) (which was increased, effective February 16, 2009,
to five hundred and twenty-seven thousand eight hundred
seventy-five dollars ($527,875), and as may be further increased
from time to time, the “ Base Salary ”). The
Base Salary received by the Executive shall be reviewed by the
Compensation Committee of the Board (the “ Compensation
Committee ”) no less frequently than annually. Any and
all increases to the Executive’s Base Salary shall be
determined by the Compensation Committee, in its sole discretion.
Increases to the Base Salary, as approved by the Compensation
Committee from time to time, shall not require written amendment of
this Agreement, and the increased Base Salary, once effective,
shall be the Base Salary for all purposes under this Agreement.
During the Employment Period, such Base Salary shall be payable in
equal biweekly installments pursuant to the Company’s
customary payroll policies in force at the time of payment, less
any required or authorized payroll deductions. The Base Salary may
be increased, but not decreased, during the Employment Period. Any
amounts due to Executive with respect to his Base Salary for the
period between the Effective Date and the execution of this
Agreement shall be paid to the Executive in a lump sum (less
applicable withholding amounts) no later than the first payroll
payment date after the execution of this Agreement.
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(b) Annual Bonus .
(i) Basic Bonus . For each
calendar year (or other fiscal year period, if the Company changes
from a calendar fiscal year) during the Employment Period, the
Executive shall be eligible to receive an annual bonus with a
target amount of sixty-five percent (65%) of his Base Salary
(“ Basic Bonus ”), subject to his satisfaction
of objective performance criteria that have been pre-established by
the Compensation Committee in a consistent manner with those of
other senior executives of the Company and following consultation
with the Executive.
(ii) Stretch Bonus . In
addition to the Basic Bonus and for each calendar year (or other
fiscal year period, if the Company changes from a calendar fiscal
year) during the Employment Period, the Executive shall be eligible
to receive an additional bonus of up to fifty percent (50%) of
the Executive’s Base Salary (“ Stretch Bonus
”), in the event of the Executive’s satisfaction of
objective stretch performance criteria that have been
pre-established by the Compensation Committee following
consultation with the Executive.
(iii) Super Stretch Bonus .
In addition to the Basic Bonus and Stretch Bonus and for each
calendar year (or other fiscal year period, if the Company changes
from a calendar fiscal year) during the Employment Period, the
Executive shall be eligible to receive a second additional bonus of
up to fifteen percent (15%) of the Executive’s Base
Salary (“ Super Stretch Bonus ”), in the event
of the Executive’s satisfaction of significant stretch
objective performance criteria that have been pre-established by
the Compensation Committee following consultation with the
Executive.
All bonuses, to the extent earned
for a particular year, shall be paid in the following calendar year
but prior to March 15th of such following calendar year. The
Basic Bonus, Stretch Bonus and Super Stretch Bonus shall be
calculated based on the annual Base Salary as in effect at the end
of each applicable calendar year. The Basic Bonus and the Stretch
Bonus shall be referred herein as the “ Target Bonus
”. The Executive acknowledges and agrees that if the Company
becomes a “publicly held corporation” within the
meaning of Section 162(m)(2) of the Internal Revenue Code of
1986, as amended (the “ Code ”), that all annual
compensation bonuses described in this Section 2.1(b) may, in
the Company’s discretion, be payable pursuant to a
“qualified performance based compensation” bonus plan
established by the Company in accordance with Code
Section 162(m) and the regulations thereunder; provided
that target percentages of Executive’s Base Salary associated
with the Basic Bonus (65%), Stretch Bonus (50 %) and Super Stretch
Bonus (15%) shall not be reduced under any such
“qualified performance based compensation” bonus
plan.
(c) Equity Arrangement . The
Executive has been previously granted Class A restricted
shares, shall be granted an Option (the “ Option
”) to purchase Class A shares and shall be granted Class
B restricted shares which shall be subject to the terms and
conditions as set forth in the equity award agreements executed
May 6, 2009 (for Class A restricted shares, the “
Class A Restricted Share Agreement ,” for Class B
restricted shares, the “ Class B Restricted Share
Agreement ,” for the Option, the “ Option
Agreement ” and collectively, the “ Equity Award
Agreements ”). The Equity Award Agreements provide that
if the Company consummates an acquisition by or merger of the
Company through a transaction or series of transactions with any of
those certain Person(s) (as defined in that certain Intelsat
Global, Ltd. 2008 Share Incentive
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Plan, effective February 4, 2008) described
in the Board resolution dated December 29, 2008 but after
which the Sponsor Shareholders do not in the aggregate possess
beneficial ownership of more than fifty percent (50%) of the
voting securities (for the election of directors) of the Company or
its successor (a “ Significant Corporate Event
”), then if on or following such Significant Corporate Event
(i) (A) the affirmative written consent of the Sponsor
Shareholders or a representative thereof is not required for the
Company to terminate the Executive’s employment at the time
of such termination and (B) the Executive’s employment
with the Company is terminated by the Company without Cause or by
the Executive for Good Reason (each as defined below), then the
applicable vesting provisions shall apply as if a Change in Control
had occurred immediately prior to such termination of employment,
or (ii) (A) the affirmative written consent of the
Sponsor Shareholders or a representative thereof is required for
the Company to terminate the Executive’s employment at the
time of such termination and at all times theretofore, and
(B) the Executive’s employment with the Company is
terminated by the Company without Cause or by the Executive for
Good Reason on or after the date that is eighteen (18) months
following the date of such Significant Corporate Event, then the
applicable vesting provisions shall apply as if a Change in Control
had occurred immediately prior to such termination of employment
(and, for the avoidance of doubt, if affirmative consent of the
Sponsor Shareholders or a representative thereof is required to
terminate the Executive’s employment and the
Executive’s employment is terminated for any reason within
the 18 month period commencing on the date of a Significant
Corporate Event, then no Change in Control vesting provisions shall
apply).
2.2 Benefits .
(a) During the Employment Period,
the Executive shall be eligible to receive the benefits as set
forth in Exhibit C attached hereto. In addition, the
Executive shall be eligible to participate, in any group insurance,
hospitalization, medical, dental, vision, health and accident,
disability, life insurance and enhanced executive life insurance,
deferred compensation, fringe benefit and retirement plans or
programs of the Company now existing or hereafter established to
the extent that he is eligible under the general provisions thereof
to the extent that all other similarly situated senior executives
participate in such plans or programs and on the same basis and at
the same levels as other similarly situated senior executives of
the Company generally.
(b) In consideration for the
Executive’s waiver of any and all claims arising under
Section 2.2 of the Previous Employment Agreement with respect
to benefits available to certain pre-privatization Company
employees, the Company shall provide to the Executive (and to the
Executive’s spouse as of the date of “Retirement”
(as defined in clause (i) below) (“ Spouse
”) and dependent children at the time of the
Executive’s Retirement (“ Dependent Children
”) retiree medical benefits for the respective lifetimes of
the Executive and his Spouse (but not for the lifetime of his
Dependent Children if both the Executive and his Spouse predecease
them), subject to the following terms, provisions and
limitations:
(i) The retiree medical benefits to
be provided to the Executive, his Spouse, and his surviving
dependent children pursuant to this subparagraph (b) shall be
provided upon any termination of the Executive’s employment
described in Sections 4.2 through 4.6 hereof (his “
Retirement ”).
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(ii) The retiree medical benefits to
be provided to the Executive (and his Spouse and surviving
dependent children) shall be separate from, but equivalent to those
medical, prescription drug, vision and dental benefits provided to
Company retirees (and their surviving spouses and surviving
dependent children) under the Intelsat Group Welfare Benefits Plan
(the “ Plan ”) (which, for the avoidance of
doubt, shall be the same retiree medical benefits provided to
individuals who were employed by the Company, but not eligible for
retirement, at the time the Company was privatized), and such
retiree medical benefits shall be provided under a sub-plan of the
Plan; provided, however, that if the Plan is cancelled or
terminated by the Company during the Executive’s lifetime,
or, if applicable, the Spouse’s lifetime, the Company shall
continue to provide retiree medical benefits, as applicable, to the
Executive, his Spouse and surviving dependent children on
substantially similar terms and conditions as those provided in the
Plan prior to any such termination or cancellation.
(iii) In January and July of each
year, the Executive (or the Spouse or surviving dependent children,
as the case may be, shall pay to the Company, on an after-tax
basis, an amount equal to the full premium cost of coverage under
the Plan for such retiree medical benefits (determined in
accordance with the methodology under the Consolidated Omnibus
Budget Reconciliation Act of 1985, as amended or such other method
as determined by the Internal Revenue Service under Code
Section 105(h)) for such month and the next five
(5) months (with a payment for any stub period in the month of
any termination of employment). Within thirty (30) days of
such payment, the Company shall pay to the Executive (or the Spouse
or surviving dependent children, as applicable), in cash (less
required withholding) an amount equal to (A) the full cost of
such premium coverage, less any premium amount that would have been
payable by the Executive (or the Spouse or surviving dependent
children, as the case may be) if he (or they) were participants in
the Plan, plus (B) an additional tax “gross up”
payment to cover all estimated applicable local, state and federal
income and payroll taxes imposed on the Executive with respect to
such payment and such additional payment. The provision of in-kind
benefits and the reimbursement of expenses incurred by the
Executive shall be subject to, and provided in accordance with the
provisions of Treas. Reg. Section §1.409A-3(i)(1)(iv) and (v),
including the provision that the amount of expenses eligible for
reimbursement or in-kind benefits provided during a calendar year
shall not affect the amount of expenses eligible for reimbursement
or in-kind benefits provided during any other calendar year. Any
reimbursement that is taxable income to the Executive shall be paid
pursuant to Section 8(c) hereof.
(iv) The parties acknowledge that,
for purposes of any continuation coverage rights that might be
available to the Executive, his Spouse, or his surviving dependent
children under Section 601 et. seq. of the Employee Retirement
Income Security Act, Code Section 4980B or any similar state
or local law, the continuation coverage period shall be deemed to
have commenced as of the date on which the Company commences
providing retiree medical benefits hereunder to the Executive (or
his surviving spouse or surviving dependent children, as the case
may be).
2.3 Expenses . During the
Employment Period, pursuant to the Company’s customary
reimbursement policies in force at the time of payment, the
Executive shall be promptly reimbursed, subject to the
Executive’s presentation of vouchers or receipts therefor,
for all expenses incurred by the Executive on behalf of the Company
or any of its Affiliates in the performance of the
Executive’s duties hereunder. Any reimbursement that is
taxable income to the Executive shall be paid pursuant to
Section 8.3 hereof.
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2.4 Other Benefits . In the
event additional enhanced benefits are granted to other members of
the Company’s executive or management committees that are
materially different than the benefits granted to the Executive
hereunder or pursuant to any other benefit plans, policies or
programs of the Company, the Executive shall be entitled to the
receipt of such other benefits and the parties hereto will amend
this Agreement to reflect such additional benefits.
3. Employment Period . The
Executive’s employment under this Agreement commenced as of
the Effective Date, and shall terminate on the first anniversary
thereof, unless terminated earlier pursuant to Section 4 (the
“ Initial Employment Period ”). Unless written
notice of either party’s desire to terminate this Agreement
has been given to the other party at least ninety (90) days
but no more than one hundred and twenty (120) days prior to
the expiration of the Initial Employment Period (or any renewal
thereof contemplated by this sentence), the term of the
Executive’s employment hereunder shall be automatically
renewed for successive one-year periods (such term, including the
Initial Employment Period, as it may be extended, the “
Employment Period ”). A notice of non-renewal provided
by the Company shall be treated as a termination by the Company
without Cause for purposes of Section 4.4 hereof and any
equity grants, and a notice of non-renewal provided by the
Executive shall be treated as a termination by the Executive
without Good Reason for purposes of Section 4.6 hereof and any
equity grants.
4. Termination and Forfeiture of
Payments and Benefits .
4.1 Termination by the Company
for Cause . The Executive’s employment with the Company
may be terminated at any time by the Company for Cause.
(a) Upon a termination for Cause,
the Company shall have no obligation to the Executive pursuant to
this Agreement other than the payment of (i) the
Executive’s then current accrued and unpaid Base Salary
through his date of termination in accordance with the
Company’s payroll practices, (ii) any accrued and unpaid
bonus for the calendar year preceding the calendar year of
termination, payable in accordance with Section 2.1(b) hereof,
(iii) any unreimbursed business expenses incurred prior to the
date of termination in accordance with Section 2.3 hereof and
(iv) any other amounts and benefits the Executive is entitled
to receive required by law or under any employee benefit plan and
programs or equity plan or grant in accordance with the terms and
provisions of such plans, programs, equity plan and grants.
Collectively, Sections 4.1(a)(i) through 4.1(a)(iv) hereof shall be
hereafter referred to as the “ Accrued Amounts
”.
(b) For purposes of this Agreement,
the term “ Cause ” shall mean any of the
following: (i) the Executive’s failure to perform
materially his duties under the Agreement (other than by reason of
illness or disability), (ii) the Executive’s indictment
for, conviction of, or plea of no contest to, a felony or his
indictment for, conviction of, or plea of no contest to, any other
crime involving moral turpitude or his indictment for or conviction
of a material dishonest act or fraud against the Company or any of
its Affiliates, (iii) any act or omission by the Executive
that is the result of his misconduct or gross negligence and that
is, or may reasonably
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be expected to be, materially injurious to the
financial condition, business or reputation of the Company or any
of its Affiliates, or (iv) the Executive’s breach of any
material provision of this Agreement. Any such occurrence described
in clause (i) or (iv) of the preceding sentence that is
curable shall constitute “ Cause ” only after
the Company has given the Executive written notice of, and twenty
(20) business days’ opportunity to cure, such violation,
and then only if such occurrence is not cured. Notwithstanding the
foregoing, if prior to the Executive’s termination of
employment without Cause (x) the Executive commits a felony
and (y) the Executive is later convicted of such felony
following the date of such termination of employment, then the
Executive shall repay to the Company all payments received by the
Executive pursuant to Section 4.4 of this Agreement and the
Company may repurchase the Executive’s outstanding common
shares pursuant to those provisions of the applicable equity award
agreements or shareholders’ agreements that would have
applied to a repurchase of such common shares if the Executive had
been terminated for Cause.
4.2 Disability . If, during
the Employment Period, the Executive becomes “disabled”
within the meaning of the Company’s applicable long-term
disability plan, the Company shall have the right to terminate the
Executive’s employment with the Company upon written notice
to the Executive. Notwithstanding the foregoing, in the event that
as a result of absence because of mental or physical incapacity
Executive incurs a “separation from service” within the
meaning of such term under Code Section 409A (as defined in
Section 8 hereof), Executive shall on such date automatically
be terminated from employment because of Disability. Upon such a
termination, the Company shall have no obligation to the Executive
other than to pay the Executive (i) the Accrued Amounts,
(ii) the benefits set forth in Section 2.2(b) hereof and
(iii) a pro-rata Target Bonus (but not any Super Stretch
Bonus) payment for the year of termination based on actual results
and the portion of the fiscal year the Executive was employed by
the Company through the effective date of such termination, payable
in the calendar year following such termination at such time
bonuses are paid to the Company’s other senior executives but
prior to March 15th of such following calendar year (the
“ Pro-Rata Bonus ”).
4.3 Death . The
Executive’s employment with the Company shall terminate
automatically upon the death of the Executive and the Company shall
have no obligation to the Executive or the Executive’s estate
other than to pay the Executive (i) the Accrued Amounts
through the date of the Executive’s death, (ii) the
benefits set forth in Section 2.2(b) hereof and (iii) the
Pro-Rata Bonus.
4.4 Termination by the Company
Without Cause . The Executive’s employment with the
Company may be terminated at any time by the Company without Cause
upon prior written notice. Subject to the Executive’s
continued compliance with his obligations under this Agreement and
except as otherwise required by law or by the terms of the
Company’s benefit plans (excluding severance plans) the
Company shall have no obligation to the Executive other than:
(i) the payment to the Executive of the Accrued Amounts;
(ii) the benefits set forth in Section 2.2(b) hereof,
(iii) the payment to the Executive of the Pro-Rata Bonus;
(iv) subject to Section 8.2 hereof, the payment of any
deferred bonus; and (v) subject to Sections 8.2 and 4.7
hereof, a lump-sum payment of an amount equal to 1.25 times the sum
of (x) the Executive’s annual Base Salary plus
(y) the Basic Bonus (as in effect as of the date of
termination) payable
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on the sixtieth (60th) day after such
termination, provided that payment in a lump-sum cash amount
shall be effective January 1, 2009, and upon any termination
theretofore the amounts shall be paid as provided in the Previous
Employment Agreement, subject to the provisions of Section 8.2
hereof. In the event that the Executive is eligible to receive the
severance benefits provided for by this Section 4.4, the
Executive shall not be eligible to receive severance benefits under
any other Company plan, policy, or agreement.
4.5 Termination by the Executive
for Good Reason . (a) During the Employment Period, the
Executive’s employment with the Company may be terminated by
the Executive for Good Reason, if the Executive provides the
Company with notice within ninety (90) days following the
first occurrence of the event constituting Good Reason detailing
the specific circumstances alleged to constitute Good Reason. In
the event that the Executive terminates his employment with the
Company for Good Reason, the Executive shall be entitled to the
same payments and benefits that he would have been entitled to
receive under Section 4.4 if his employment had been
terminated by the Company without Cause.
(b) For purposes of this Agreement,
the term “ Good Reason ” shall mean any of the
following conditions or events without the Executive’s prior
consent: (i) a material diminution of the Executive’s
title or a material diminution of the Executive’s position or
responsibilities that is inconsistent with the Executive’s
title, (ii) a material breach by the Company of any terms of
the Agreement, (iii) a reduction in the Executive’s Base
Salary or bonus potential, or the failure to pay the Executive any
material amount of compensation when due, or (iv) a relocation
of the Company’s principal U.S. place of business more than
fifty (50) miles away from Washington, D.C. Any such
occurrence of a condition or event set forth in clause
(i)–(iv) above shall constitute “ Good Reason
” only after the Executive has given the Company written
notice of, and thirty (30) business days’ opportunity to
cure such violation(s). Any termination of employment as a result
of Good Reason shall occur within one hundred and eighty
(180) days of the occurrence of the Good Reason
event.
4.6 Termination by the Executive
Without Good Reason . The Executive may voluntarily resign from
his employment with the Company without Good Reason,
provided that the Executive shall provide the Company with
ninety (90) days’ advance written notice (which notice
requirement may be waived, in whole or in part, by the Company in
its sole discretion) of his intent to terminate. Upon such a
termination, the Company shall have no obligation to the Executive
other than (i) the payment to the Executive of the Accrued
Amounts through the effective date of such termination as initially
specified by the Executive (without giving effect to any waiver of
the 90-day notice requirement), provided that the
Company’s obligation shall not extend beyond 90 days from the
date of the Executive’s notice of termination; and
(ii) the benefits set forth in Section 2.2(b)
hereof.
4.7 Release of Claims . Any
and all amounts payable and benefits or additional rights provided
pursuant to Sections 4.4 and 4.5 beyond the Accrued Amounts shall
only be payable if the Executive delivers to the Company and does
not revoke a waiver and release of claims in the form attached
hereto as Exhibit A and such waiver and release of claims
shall have become effective in accordance with its terms. Such
waiver and release of claims shall be executed and delivered (and
no longer subject to revocation, if applicable) within sixty
(60) days following termination. Not later than seven
(7) business days after the termination of employment, the
Company shall deliver the waiver and release to the Executive duly
executed by the Parent and the Company.
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4.8 Resignation . Upon a
termination of employment, the Executive will upon the
Company’s request resign from all boards of directors and
officer positions of the Company and any of its
Affiliates.
4.9 No Mitigation/No Set
Off/Beneficiary . In no event shall the Executive be obligated
to seek other employment or take any other action by way of
mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement, nor shall the amount of any payment
hereunder be reduced by any compensation earned by the Executive as
a result of employment by a subsequent employer. The
Company’s obligation to pay the Executive the amounts
provided and to make the arrangements provided hereunder shall not
be subject to set off, counterclaim or recoupment.
4.10 Beneficiary . In the
event the Executive dies after termination of employment, but prior
to the payment of any amounts due under Section 4, such
amounts shall be paid to the Executive’s estate, except that
if the Executive provides written notice to the Company’s
senior human resources personnel of a designated beneficiary or
designated beneficiaries then such amount shall be paid to such
designated beneficiary or designated beneficiaries.
4.11 280G Gross-Up . In the
event that any amount or benefit that may be paid or otherwise
provided to or in respect of the Executive by the Company or any
affiliated company, whether pursuant to this Agreement or
otherwise, is or may become subject to the tax imposed under Code
Section 4999, the provisions of Exhibit D attached
hereto shall be applicable.
5. Covenants .
5.1 The Executive understands that,
in the course of his or her employment with the Company, he or she
will be given access to confidential information and trade secrets
including, but not limit to, discoveries, ideas, concepts, software
in various stages of development, designs, drawings,
specifications, techniques, models, data, source code, object code,
documentation, diagrams, flowcharts, research, development,
processes, procedures, “know-how,” marketing techniques
and materials, marketing and development plans, business plans,
merger or acquisition investigations, customer names and other
information relating to customers, price lists, pricing policies,
and financial information (“ Confidential Information
”). Confidential Information also includes any information
described above which the Company obtains from another party and
which the Company treats as proprietary or designates as
Confidential information, whether or not owned or developed by the
Company. The Executive agrees that during his employment by the
Company and thereafter to hold in confidence and not to directly or
indirectly reveal, report, publish, disclose, or transfer any
Confidential Information to any person or entity, or utilize any
Confidential Information for any purpose, except in the course of
the Executive’s work for the Company. The Executive agrees to
turn over all copies of Confidential Information in his control to
the Company upon request or upon termination of his employment with
the Company. For purposes of this Section 5.1, the
“Company” shall include Affiliates of the Company. The
Executive agrees to enter into as of May 6, 2009 the
Company’s general Conflict of Interest and Confidentiality
Agreement set forth on Exhibit B .
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5.2 The Executive agrees that,
during his employment with the Company and for one (1) year
thereafter (the “ Restricted Period ”), he will
not, either directly or indirectly, hire Company employees or
former employees (which shall for this purpose include any
individual employed by the Company at any point during the year
preceding such hiring), induce, persuade, solicit or any attempt to
induce, persuade, or solicit any of the Company’s employees
to leave the Company’s employ, nor will he help others to do
so except to the extent that any such inducement, persuasion or
solicitation or attempt to induce, persuade or solicit a Company
employee to leave the Company’s employ during his employment
is necessary or desirable as determined by the Executive’s
good faith judgment in connection with the performance of the
Executive’s duties to the Company as set forth in this
Agreement. This means, among other things, that if the
Executive’s employment with the Company terminates (whether
voluntarily or involuntarily), he shall refrain for one
(1) year from in any way helping any person or entity hire any
of his former, fellow employees away from the Company,
provided that the Executive may serve as a reference for
such employees and former employees and actions taken by any person
or entity with which the Executive is associated if the Executive
is not, directly or indirectly, personally involved in any manner
in the matter and has not identified such Company-related person or
Affiliates for soliciting or hiring will not be considered a
violation for purposes of this Section 5.2. This shall not be
construed to prohibit general solicitations of employment through
the placing of advertisements. For purposes of this
Section 5.2, the Company shall include Affiliates of the
Company.
5.3 The Executive agrees that,
during the Restricted Period, he shall not, without the prior
written consent of the Board, engage in or become associated with
any business or other endeavor engaged in or competitive with the
businesses (the “ Protected Businesses ”)
conducted by the Company or its Affiliates (which Protected
Businesses include, without limitation, the provision of FSS
services on a retail basis, a wholesale basis and on a distributor
basis); provided, that, the Protected Businesses shall not include
any other businesses of an entity (i) directly or indirectly
owned or controlled by any Sponsor Shareholder (as such term is
defined in the current draft of the Management Shareholders
Agreement) (unless those businesses are businesses of the Company
or any of its Subsidiaries or businesses of other entities in which
the Company, directly or indirectly, owns 20% or more of the equity
interests) or (ii) in which the Company, directly or
indirectly, owns less than 20% of the equity interests. For these
purposes, the Executive shall be considered to have become
“associated with” a business or other endeavor if the
Executive becomes directly or indirectly involved as an owner,
principal, employee, officer, director, independent contractor,
representative, stockholder, financial backer, agent, partner,
advisor, lender, or in any other individual or representative
capacity with any individual, partnership, corporation or other
organization that is engaged in that business. The foregoing shall
not be construed to forbid the Executive from (i) engaging in
the practice of law with a law firm or similar entity, where such
firm or entity may have among its clients (and the Executive may
assist in representing) businesses engaged in the Protected
Businesses so long as the Executive complies with the provisions of
Section 5.1 or (ii) making or retaining investments in
less than one percent of the equity of any entity, if such equity
is listed on a national securities exchange or regularly traded in
an over-the-counter market.
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5.4 The Executive agrees that during
and after his employment by the Company, the Executive will assist
the Company and its Affiliates in the defense of any claims, or
potential claims that may be made or threatened to be made against
the Company or any of its Affiliates in any action, suit or
proceeding, whether civil, criminal, administrative, investigative
or otherwise (a “ Proceeding ”), and will assist
the Company and its Affiliates in the prosecution of any claims
that may be made by the Company or any of its Affiliates in any
Proceeding, to the extent that such claims may relate to the
Executive’s employment or the period of the Executive’s
employment by the Company. The Executive agrees, unless precluded
by law, to promptly inform the Company if the Executive is asked to
participate (or otherwise become involved) in any Proceeding
involving such claims or potential claims. The Executive also
agrees, unless precluded by law, to promptly inform the Company if
the Executive is asked to assist in any investigation (whether
governmental or otherwise) of the Company or any of its Affiliates
(or their actions), regardless of whether a lawsuit has then been
filed against the Company or any of its Affiliates with respect to
such investigation. The Company agrees to reimburse the Executive
for all of the Executive’s reasonable out-of-pocket expenses
associated with such assistance, including lost wages or other
benefits, travel expenses and any attorneys’ fees. Any
reimbursement that is taxable income to the Executive shall be paid
pursuant to Section 8.3 hereof.
5.5 The Company and the Executive
acknowledge that the time, scope, geographic area and other
provisions of this Section 5 have been specifically negotiated
by sophisticated commercial parties and agree that all such
provisions are reasonable under the circumstances of the activities
contemplated by this Agreement. The Executive acknowledges and
agrees that the terms of this Section 5: (i) are
reasonable in light of all of the circumstances, (ii) are
sufficiently limited to protect the legitimate interests of the
Company and its Affiliates, (iii) impose no undue hardship on
the Executive and (iv) are not injurious to the public. The
Executive further acknowledges and agrees that (x) the
Executive’s breach of the provisions of this Section 5
will cause the Company irreparable harm, which cannot be adequately
compensated by money damages, and (y) if the Company elects to
prevent the Executive from breaching such provisions by obtaining
an injunction against the Executive, there is a reasonable
probability of the Company’s eventual success on the merits.
The Executive consents and agrees that if the Executive commits any
such breach or threatens to commit any breach, the Company shall be
entitled to temporary and permanent injunctive relief from a court
of competent jurisdiction, without posting any bond or other
security and without the necessity of proof of actual damage, in
addition to, and not in lieu of, such other remedies as may be
available to the Company for such breach, including the recovery of
money damages. The parties hereto acknowledge and agree that the
provisions of Section 7.8 below are accurate and necessary
because (A) this Agreement is entered into in the District of
Columbia, (B) as of the Closing Date, the District of Columbia
will have a substantial relationship to the parties hereto and to
the transactions contemplated by the Share Purchase Agreement,
(C) the use of District of Columbia law provides certainty to
the parties hereto in any covenant litigation in the United States,
and (D) enforcement of the provisions of this Section 5
would not violate any fundamental public policy of the District of
Columbia or any other jurisdiction. In the event that the
agreements in this Section 5 shall be determined by any court
of competent jurisdiction to be unenforceable by reason of their
extending for too great a period of time or over too great a
geographical area or by reason of their being too extensive in any
other respect, they shall be interpreted to extend
11
only over the maximum period of time for which
they may be enforceable and/or over the maximum geographical area
as to which they may be enforceable and/or to the maximum extent in
all other respects as to which they may be enforceable, all as
determined by such court in such action.
6. Notices . Any notice or
communication given by either party hereto to the other shall be in
writing and personally delivered; mailed by registered or certified
mail, return receipt requested, postage prepaid; delivered by an
internationally recognized delivery or courier service (such as
FedEx or DHL); delivered by facsimile; or sent by electronic mail
if the recipient acknowledges receipt, to the following
addresses:
If to the Company:
Intelsat, Ltd.
North Tower, 2nd Floor
90 Pitts Bay Road
Pembroke HM 08, Bermuda
Telecopy: +441-292-8300
Attention: Chief Executive
Officer
With a copy (which shall not
constitute notice) to:
Intelsat Corporation
3400 International Drive,
NW
Washington, DC 20008-3006
Telecopy:
(202) 944-7440
Attention: Chief Executive
Officer
If to the Parent:
Intelsat Global, Ltd.
North Tower, 2n
