EXHIBIT 10.42
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") by and between
Motient
Corporation, a corporation organized under the laws of the State of
Delaware
("Company"), and CHRISTOPHER W. DOWNIE ("Employee") is hereby
entered into
effective as of November 21, 2005 (the "Effective Date").
RECITALS
WHEREAS, the Company desires to employ Employee as Executive
Vice
President and Chief Operating Officer of the Company, and Employee
desires to
accept employment with the Company as Executive Vice President and
Chief
Operating Officer, all on the terms and conditions set forth in
this Agreement;
and
NOW, THEREFORE, in consideration of the mutual promises, terms,
covenants and conditions set forth herein and the performance of
each, it is
hereby agreed as follows:
AGREEMENTS
1. Employment and Duties.
(a) The Company hereby employs Employee as Executive Vice
President and Chief Operating Officer of the Company to be
headquartered in
Lincolnshire, Illinois. As such, Employee shall have
responsibilities, duties
and authority reasonably accorded to, expected of, and consistent
with
Employee's position as the Executive Vice President and Chief
Operating Officer.
Employee hereby accepts this employment upon the terms and
conditions herein
contained and, subject to paragraph 1(c), agrees to devote
substantially all of
his time, attention and efforts to promote and further the business
and
interests of the Company and its subsidiary entities (including
joint ventures)
or any other entity within the current or future ownership
structure.
(b) The Company and Employee agree that this Agreement may be
assigned to any majority-owned subsidiary of the Company or any
other
majority-owned entity (in either case, and including any successor
in interest
through merger or otherwise, the "Successor Employer") within the
current or
future ownership structure. In the event of any such assignment,
the Company and
the Successor Employer shall each be directly and jointly and
severally
responsible for the timely and full satisfaction of all obligations
of the
Company as set forth in this Agreement. References to the Company
shall include
and also mean each Successor Employer.
(c) Subject to the specific terms of this Agreement, Employee
shall faithfully adhere to, execute and fulfill all lawful policies
established
by the Company.
(d) Employee shall not, during the term of his employment
hereunder, engage in any other business activity pursued for gain,
profit or
other pecuniary advantage. The foregoing limitations shall not be
construed as
prohibiting Employee from making personal investments in such form
or manner as
will neither require his services in the operation or affairs of
the companies
or enterprises in which such investments are made.
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2. Compensation. For all services rendered by Employee, the
Company
shall pay to Employee the following compensation:
(a) Base Salary. The base salary payable to Employee during
the term shall be not less than $240,000 per year, payable in
accordance with
the Company's normal payroll procedures, but not less frequently
than monthly.
Such base salary will be increased by four (4%) percent annually
during the term
of this Agreement and may be increased by a larger amount from time
to time, at
the discretion of the Company's Board of Directors in light of the
Employee's
position, responsibilities and performance, and, as increased from
time to time,
may not be reduced.
(b) Benefits. Employee shall be entitled to retirement and
health and welfare benefits as provided by the Company from time to
time to, and
on a basis which is as least as favorable as that provided to,
other similarly
situated employees of the Company.
(c) Performance Bonus. Employee shall be entitled to
Performance Bonuses as follows:
(i) For 2005, Employee shall be paid a Performance Bonus of
$191,250, which amount the Company acknowledges and agrees that
Employee has
earned by services rendered by Employee to the Company through (and
including)
the Effective Date and that the payment of such amount is
unconditional. The
aforesaid amount shall be paid to the Employee on the first to
occur of: (1) the
Closing (as defined below); (2) termination of Employee's
employment, without
regard to whether such termination is effected by the Employee or
the Company,
is effected with or without Cause or Good Reason (as discussed
below), or does
or does not entitle Employee to Severance Payment (as discussed
below); or (3)
December 31, 2005.
(ii) Employee will be eligible to receive for each Company
fiscal year after 2005 a performance bonus of up to a maximum of
fifty percent
(50%) of Base Salary upon the achievement of performance goals to
be established
in a Bonus Plan at a later date (or based upon the achievement of
other
Company-wide performance objectives established by the Company, if
no such Bonus
Plan exists).
(d) Deferrals. The Company shall not take or fail to take any
action, which action or failure to act, either alone or together
with other
facts and conditions, would result in adverse tax treatment of the
Employee
under Section 409A of the Internal Revenue Code of 1986, as amended
(the
"Code"), and the Treasury regulations thereunder. This shall
include, but shall
not be limited to, the deferral of payments or other events as
necessary to
comply with Section 409A(a)(2)(B) of the Code, to the extent
applicable.
3. Term; Termination; Rights on Termination; Severance Payment.
(a) The term of this Agreement shall begin on the Effective
Date and continue until thirty (30) days following the Closing, as
defined
below, or the second anniversary of the Effective Date, whichever
is the first
to occur. The term may be extended by agreement of the parties.
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(b) This Agreement and Employee's employment may be terminated
in any of the following ways:
(i) The lapse of thirty (30) days following the occurrence of
the Closing without an extension of the term by agreement of the
parties;
(ii) Death. The death of Employee shall immediately terminate
this Agreement and no Severance Payment as defined below will be
due Employee's
estate;
(iii) Disability. If Employee becomes entitled to receive
benefits under an insured long-term disability plan of the Company
that includes
its officers, either the Employee or the Company may terminate
Employee's
employment hereunder with no Severance Payment due Employee;
(iv) By Company with Cause. The Company may terminate this
Agreement and Employee's employment upon written notice to Employee
for "Cause,"
which shall be: (1) Employee's willful failure in the performance
or
nonperformance of any of Employee's duties and responsibilities
hereunder; (2)
Employee's dishonesty or fraud with respect to the business,
reputation or
affairs of the Company; (3) Employee's conviction of a felony crime
involving
moral turpitude; or (4) Employee's willful failure to abide by any
substantial
lawful policy or directive of the Company. Employee's absence
during a required
or permitted leave of absence shall not constitute Cause. The
Company recognizes
that the audit committee of the board of directors of the Company
has
investigated certain matters that are substantially similar to
ongoing
litigation in Delaware initiated by affiliates of James Dondero.
Based on this
investigation, the Company hereby agrees that no wrongdoing has
occurred with
respect to the allegations in such lawsuits, and in no event shall
such
allegations give rise to a termination of the Employee for "Cause."
Prior to
termination of Employee for "Cause" pursuant to clauses (1) or (4)
above,
Company shall, to the extent reasonably practicable, grant Employee
five (5)
business days' written notice to cure any defect giving rise to
such "Cause". In
the event of a termination for Cause, Employee shall have no right
to receive
any Severance Payment, as defined below.
(v) By Company Without Cause. The Company may terminate this
Agreement and Employee's employment without Cause upon written
notice to
Employee. In the event of a termination by the Company Without
Cause, the
Employee will be entitled to any Severance Payment as defined
below;
(vi) By Employee Without Good Reason. Employee may, without
Good Reason (as hereinafter defined), resign or otherwise terminate
this
Agreement and Employee's employment effective upon written notice
is provided to
the Company. If Employee resigns or otherwise terminates his
employment without
Good Reason, Employee shall have no right to receive any Severance
Payment as
defined below; and
(vii) By Employee for Good Reason. Employee shall have "Good
Reason" to terminate his employment hereunder upon the occurrence
of any of the
following
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events, unless Employee agrees in a writing executed
contemporaneously with or
after the occurrence of the event that it shall not constitute
"Good Reason":
(1) Employee is demoted by means of a material reduction in
authority,
responsibilities or duties to a position of less stature or
importance within
the Company than the position described in paragraph 1(a) hereof,
(2) Employee
terminates his employment (for any reason) within ninety (90) days
following a
Change of Control (as defined below), (3) Employee is required to
work from a
location not in the greater New York City area for an average of
more than three
days per week, including travel time to and from such location,
over the course
of any calendar month, or (4) any breach by Company of the terms of
this
Agreement. Prior to termination of employment for "Good Reason"
pursuant to
clauses (1), (3) or (4) above, Employee shall be required to grant
Company five
(5) business days' written notice to cure the event or condition
giving rise to
such "Good Reason." In the event the Employee terminates his
employment for Good
Reason, Employee will be entitled to Severance Payment as defined
below.
(viii) Change of Control. A "Change of Control" means the
occurrence of any of the following events; provided that in no
event shall the
Closing (hereinafter defined) constitute a Change of Control:
(1) any person
or group of persons
(as defined in
Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended and
in effect from time to time (the "Exchange Act")) (other than
persons who are
stockholders of the Company immediately prior to the transaction)
together with
its affiliates, excluding employee benefit plans of the Company, is
or becomes,
directly or indirectly, the "beneficial owner" (as defined in Rule
13d-3 under
the Exchange Act) of securities of the Company representing 40% or
more of the
combined voting power of the Company's then outstanding
securities;
(2) the dissolution or liquidation of the Company or a merger,
consolidation, or reorganization of the Company with one or more
other entities
in which the Company is not the surviving entity, or the sale of
substantially
all of the assets of the Company to another person or entity;
(3) any transaction (including without limitation a merger or
reorganization in which the Company is the surviving entity) which
results in
any person or entity (other than persons who are shareholders of
the Company or
affiliates immediately prior to the transaction) owning more than
50% of the
combined voting power of all classes of securities/interests of the
Company; or
(4) individuals who at the beginning of any two-year period
constitute the board of directors, plus new directors of the
Company whose
election or nomination for election by the Company's shareholders
is approved by
a vote of at least two-thirds of the directors of the Company still
in office
who were directors of the Company at the beginning of such two-year
period,
cease for any rea
