Exhibit 10.17
RESIGNATION AGREEMENT
This
Resignation Agreement (the “Agreement”) is hereby
entered into effective as of September 6, 2007 by and between Leap
Wireless International, Inc. (“Leap”), Cricket
Communications, Inc. (“Cricket” and together with Leap,
the “Company”), and Amin Khalifa (the
“Executive”). Leap, Cricket and the Executive are
sometimes referred to herein as a “Party” or
collectively as the “Parties.”
RECITALS
WHEREAS
, Executive is currently employed by Cricket as its Executive Vice
President and Chief Financial Officer, serves as the Executive Vice
President and Chief Financial Officer of Leap and the domestic
subsidiaries of Leap and Cricket, and serves on the Board of
Directors of Cricket and the domestic subsidiaries of Leap and
Cricket; and
WHEREAS
, Cricket offered Executive employment, and Executive accepted such
offer, through a letter from Cricket to Executive dated
July 19, 2006. In addition, Executive, Leap and Cricket
entered into a Severance Benefits Agreement as of
September 15, 2006 (collectively, such offer letter and
Severance Benefits Agreement are referred to as the “2006
Agreements”); and
WHEREAS
, Executive, Leap and Cricket wish to enter into this Agreement to
terminate the employment relationship between Executive and Cricket
through Executive’s resignation effective as of
September 6, 2007 (the “Termination Date”), to
terminate and supersede the 2006 Agreements in their entirety, and
to resolve amicably all of their obligations to each other.
AGREEMENT
NOW,
THEREFORE , in consideration of the mutual covenants contained
in this Agreement, and for other good and valuable consideration,
the adequacy of which is hereby acknowledged, the Parties hereby
agree as follows:
1. 2006 Agreements . The
2006 Agreements shall be superseded entirely by this Agreement, and
the 2006 Agreements shall have no further force or effect. Each of
Executive, Leap and Cricket acknowledge and agree that they do not
have any claims against any other Party based on or arising under
the 2006 Agreements.
2. Employment and Officer
Status . Executive hereby resigns as an employee of Cricket
effective as of the Termination Date. Executive’s separation
from employment shall be reflected in Cricket’s records as a
voluntary resignation. Executive hereby resigns from his position
as Executive Vice President and Chief Financial Officer (and any
other officer positions he may hold) of Leap, Cricket and each of
their respective domestic affiliates and subsidiaries effective as
of the Termination Date. Executive shall execute any additional
documentation necessary to effectuate such resignations.
3. Resignation From
Board . Executive hereby resigns from his position as a member
of the Boards of Directors of Cricket and each of the domestic
affiliates and subsidiaries of Leap and Cricket effective as of the
Termination Date. Executive shall execute any additional
documentation reasonably requested by the Company to effectuate
such resignations.
4. Compensation Through the
Termination Date . Executive acknowledges and agrees that on
the Termination Date, Cricket will issue Executive his final
paycheck, reflecting (a) his earned but unpaid base salary
through the Termination Date, and (b) all accrued, unused
vacation due Executive through the Termination Date. The payments
described in this Section shall be subject to all applicable taxes
and withholding. Cricket, within thirty (30) days after the
Termination Date, will reimburse Executive for any and all business
expenses incurred by Executive in connection with the performance
of his job duties prior to the Termination Date and reimbursable to
Executive pursuant to the Company’s travel and expense
reimbursement policies, which expenses shall be submitted to
Cricket with supporting receipts and/or documentation no later than
fifteen (15) days after the Termination Date. Executive
acknowledges and agrees that with his final check, and the expense
reimbursement check described in this Section, Executive will have
received all monies, bonuses, commissions, expense reimbursement,
vacation pay, and other compensation he earned or is due in
connection with his employment by Cricket. Executive acknowledges
and agrees that the payments and benefits described in this Section
constitute the only compensation, benefits or other amounts to
which he is entitled pursuant to any policies, practices or benefit
programs maintained by Leap or Cricket related to compensation and
benefits. Effective as of the Termination Date, (a) Executive
waives and relinquishes any right he may have to exercise any and
all stock options granted to him by Leap under the 2004 Stock
Option, Restricted Stock and Deferred Stock Unit Plan (the
“2004 Stock Plan”), and (b) Executive sells to
Leap, and Leap repurchases from Executive, all shares of Leap
common stock granted and sold to Executive under the 2004 Stock
Plan pursuant to Restricted Stock Award Grant Notices/Restricted
Stock Award Agreements for the original cash purchase price for
such shares, payable to Executive within seven days of the
Termination Date. Executive further acknowledges and agrees that,
effective as of the Termination Date, Executive will hold no right
to stock, stock options, restricted stock, or deferred stock units
in either Leap or Cricket, or long-term equity-based incentive
compensation from the Company (collectively “Equity”),
and hereby waives and relinquishes any claim to such Equity. This
Section 4 shall not, however, constitute a waiver of any of
Executive’s rights to any vested benefits under the
Company’s 401(k) plan or to the payment to Executive of
amounts credited to the Executive’s account under the Leap
Employee Stock Purchase Plan in accordance with the provisions of
such plan relating to employees whose employment with the Company
has terminated, such credited amounts estimated to be approximately
$2,200.00.
5. Entitlement to
Benefits. Except as provided in this Agreement,
Executive’s entitlement to benefits from Leap or Cricket, and
eligibility to participate in the benefit plans of Leap and
Cricket, shall cease on the Termination Date, except to the extent
Executive elects to and is eligible to continue his medical and
dental benefits pursuant to COBRA. If Executive elects to continue
benefits pursuant to COBRA, Cricket shall pay for such benefits for
twelve months or, if shorter, until Executive qualifies for medical
and dental benefits with another employer, provided, however, the
total amount that Cricket shall be obligated to pay for such
benefits shall not exceed Twenty One Thousand Dollars ($21,000).
This Section 5 shall not, however, constitute a waiver of any
of Executive’s rights to any vested benefits under the
Company’s 401(k) plan or to the
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payment
to Executive of amounts credited to the Executive’s account
under the Leap Employee Stock Purchase Plan in accordance with the
provisions of such plan relating to employees whose employment with
the Company has terminated, such credited amounts estimated to be
approximately $2,200.00.
6. Severance Payment .
Subject in all respects to (i) Executive’s performance
of his obligations under this Agreement,
(ii) Executive’s execution and delivery to the Company
of the General Release attached hereto and incorporated herein as
Addendum A (the “General Release”), and
(iii) the expiration of the seven day revocation period
following the execution and delivery of the General Release as
described therein, without Executive’s having given notice of
revocation, Cricket shall pay Executive a severance payment in the
gross amount of Five Hundred Ninety Thousand, Six Hundred Twenty
Five Dollars ($590,625) ( subject to applicable withholding at the
minimum permissible rate) in a lump sum in accordance with the
Company’s payroll practices as soon as practicable, in
accordance with the Company’s normal accounting practices,
after the date on which the General Release becomes irrevocable
(but in no event more than two weeks after such date), in lieu of
any payments or benefits to which Executive may have been entitled
pursuant to the 2006 Agreements or otherwise with respect to the
termination of his employment with Cricket and his officer and
director relationships with Leap, Cricket and the domestic
subsidiaries of Leap and Cricket.
7. Proprietary
Information . Executive acknowledges that certain information,
observations and data obtained by him during the course of or
related to his employment with the Company (including, without
limitation, information with respect to the Company’s and its
affiliates’ operations, processes, products, inventions,
business practices, finances, principals, employees, vendors,
suppliers, customers, potential customers, shareholders, business
plans, marketing plans, proposals or methods, costs, prices,
contractual relationships, regulatory status, compensation paid to
employees or other terms of employment) are the sole property of
the Company and constitute trade secrets and/or confidential
business information of the Company. Promptly following the
execution of this Agreement, Executive agrees to return all files,
customer lists, financial information or other Company property
(excluding documents that have been publicly filed with the SEC)
which are in the Executive’s possession or control without
making copies thereof. Except as required pursuant to applicable
law, Executive further agrees that he will not disclose to any
person or use for his own account any of the above described trade
secret information, observations or data without the written
consent of Leap’s Board of Directors. Further, Executive
acknowledges that any unauthorized use of the above described
confidential information will cause irreparable harm to the Leap
and Cricket and their affiliates and will give rise to an immediate
action by any of them for injunctive relief. Executive continues to
be bound by the Invention Disclosure, Confidentiality and
Proprietary Rights Agreement that he signed during his employment
in accordance with the terms thereof.
8. Cooperation Clause .
Executive agrees to cooperate fully with the Company (including the
Boards of Directors of Leap and Cricket and any special committees
of the Boards of Directors of Leap and Cricket) and its counsel and
accountants in any financial audits or internal investigation
involving securities, financial, accounting, or other matters, and
in its defense of, or other participation in, any administrative,
judicial, or other proceeding arising from any charge, complaint or
other action which has been or may be filed relating to the period
during which Executive was employed by Cricket. Cricket agrees to
reimburse Executive for: (a) his reasonable
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and
actual expenses incurred in providing such cooperation; and
(b) his time spent providing such cooperation at his then
current regular rate of pay, or if none, in an amount not less than
$250 per hour provided, however, the Company shall have no
obligation to reimburse Executive under this Section 8 for his
time, cooperation or assistance in any matter in which he is named
as a defendant or respondent or with respect to which Executive
requests indemnification pursuant to Section 12 of this
Agreement. Except as required by law or authorized in advance by
the Leap Board of Directors, Executive shall not knowingly
communicate, directly or indirectly, with shareholders of Leap or
their representatives concerning the management of the Company, the
operations of the Company, or the financial status of the Company.
Executive shall not knowingly take any action materially
detrimental to the interests of the Company or its management.
Nothing in the preceding two sentences shall apply to testimony
given by any person in a legal proceeding.
9. Confidentiality of
Agreement . Except as expressly set forth in Section 10,
the provisions of this Agreement shall be held in strictest
confidence by the Parties and shall not be publicized or disclosed
in any manner whatsoever; provided, however, that:
(a) Executive may disclose this Agreement, in confidence, to
his spouse; (b) the Parties may disclose this Agreement in
confidence to their respective attorneys, accountants, auditors,
tax preparers, and financial advisors; (c) Leap may disclose
this Agreement as necessary to fulfill standard or legally required
SEC or corporate reporting or disclosure requirements; (d) the
Parties may disclose this Agreement insofar as such disclosure may
be necessary to enforce its terms or as otherwise required by law;
and (e) Executive may inform third parties that he voluntarily
resigned from his positions with Leap and Cricket.
10. Press Release; Mutual
Nondisparagement .
a. No later than
September 7, 2007 Leap shall issue a press release regarding
Executive’s resignation in the form attached hereto as
Addendum B or in such other form as the Parties mutually agree to.
Except as required by law or court order, neither Leap, Cricket,
nor their respective officers or directors shall make any
additional or inconsistent public statements regarding
Executive’s resignation, termination or departure from the
Company, or performance while employed by the Company, unless in
response to a prior statement or communication by a Party in
violation of this Section 10. The Company shall not encourage
or induce any employees to m
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