Exhibit (10)(iii)(A)(15)(i)
to Form 10-K for 1993
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of the lst day of January, 1989 between
Cincinnati Bell Inc., an Ohio corporation with its principal place of business
in Cincinnati, Ohio ("Employer" or "CBI"), and James F. Orr, an individual
residing in Ohio ("Employee").
WITNESSETH
WHEREAS, Employer wishes to develop its telemarketing business through a
new subsidiary ("Newco");
WHEREAS, Employee has a marketing background and has indicated a desire to
work for Employer in developing its telemarketing business;
WHEREAS, Employee wishes to be employed by Employer and Employer wishes to
employ Employee, all pursuant to the terms hereof; and
WHEREAS, Employer intends to retain the right to assign this Agreement to
any other entity which is part of the same controlled group of corporations, as
defined in Section 1563 of the Internal Revenue Code of 1986, as it may from
time to time be amended or restated, provided, that upon such assignment CBI
will guarantee or otherwise support any payments due hereunder to employee.
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants and agreements contained herein, the parties agree as follows:
1. EMPLOYMENT. Employer employs Employee and Employee accepts employment
upon the terms and conditions hereinafter set forth. For purposes of this
Agreement, Employer
shall include any entity to which this Agreement is assigned under Section 14.
2. TERMS OF EMPLOYMENT. This Agreement shall continue in full force and
effect commencing on January 1, 1989 (the "Effective Date") and ending on
December 31, 1993 (the "Expiration Date"), unless this Agreement is earlier
terminated in accordance with the provisions of Section 13 hereof.
3. DUTIES.
(A) Employer agrees to employ Employee and Employee agrees to serve
Employer as Vice President Market Development of Newco. In such position,
Employee shall have primary responsibility for developing and implementing a
marketing plan for the telemarketing services of Newco, and shall directly
supervise all marketing employees and activities.
(B) In connection with performing the services required in Section
3(A), Employee will be provided appropriate office space, a secretary (but not
necessarily a full-time secretary), and travel expenses as described in Section
5, hereof. The extent of such support resources will be agreed upon from time
to time by Employee and the President of Newco.
(C) Employee shall devote his entire time, attention, and energies to
the business of Newco. The words "entire time, attention, and energies" are
intended to mean that Employee shall devote his full effort during reasonable
working hours to the business of Newco and shall devote at least 40 hours per
week to the business of Newco.
(D) Employee shall not be required to change his current residence;
however, Employee shall travel to such areas and places as are reasonably
necessary in the performance of his duties.
4. COMPENSATION.
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(A) Employee shall receive a base salary (the "Base Salary") of at
least $150,000 for each calendar year, subject to proration for any partial
year, during the term of this Agreement. Such Base Salary, and any other
amounts payable hereunder, shall be subject to withholding as required by law.
(B) In addition to the Base Salary, Employee shall be entitled to
receive an annual bonus (the "Bonus") for each calendar year for which services
are performed under this Agreement, subject to proration for any partial year
during such term. Any Bonus shall be payable after the conclusion of Employer's
calendar year in accordance with its regular bonus payment policies. Employee
shall receive Bonuses as follows:
Initially, a maximum of $50,000 per year, based (i) 50% on the
results of Newco's earnings (computed as provided in Section 7)
results as compared to its earnings commitment submitted to and
approved by the Board of Directors of CBI, and (ii) 50% on CBI's
earnings results as compared to its earnings commitment submitted
to and approved by the Board of Directors of CBI.
At the discretion of the President of Newco, such bonus
computation may be revised and based 100% on the results of
Newco's revenue and earnings results as compared to its revenue
and earnings commitment submitted to and approved by the Board of
Directors of CBI. In computing Newco's earnings results or CBI's
earnings results, any salaries, bonuses, employee benefit plan
obligations, other compensatory amounts or reimbursement for
employee expenses for any person who devotes substantially all of
his or her time, attention and energy to the
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business of Newco, whether or not paid or accrued by Newco, shall
be allocated solely to Newco's earnings results. The earnings
results of Newco and CBI shall not be decreased or adjusted by
any amount payable to any person who devotes substantially all of
his or her time, attention and energy to the business of Newco,
whether or not paid or accrued by Newco, for any repurchase of
Newco's Class B Common Shares or for the accrual or payment of
the Performance Award to Employee or the payment or accrual of a
similar award to any other person. At the discretion of the
President of Newco, such Bonus computation may be revised and
based 100% on the results of Newco's revenue and earnings results
as compared to its revenue and earnings commitment submitted to
and approved by the Board of Directors of CBI. While the Bonus
for each year is to be determined in the sole discretion of the
President of Newco, it is understood by the parties that such
Bonus generally will be paid in full upon the reasonable
satisfaction of the above criteria.
(C) On or before February 1, 1989, Employee shall receive from
Employer a one-time payment of $30,000 representing a bonus for agreeing to be
employed by Employer.
(D) On at least an annual basis, Employee shall receive a formal
performance review and be considered for salary and/or bonus increases.
5. EXPENSES.
All reasonable and necessary expenses incurred by Employee in the
course of the performance of his duties to Employer shall be reimbursable in
accordance with Employer's
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then current travel and expense policies.
6. BENEFITS.
(A) Employee shall be granted options to purchase 2,000 common shares
of CBI. Such options shall be granted under CBI's 1988 Long Term Incentive Plan
(the "1988 Plan") effective as of the date of the next meeting of the
Compensation Committee of the Board of Directors of CBI following the Effective
Date. Such options shall further be subject to the terms of the 1988 Plan and
to the same terms and conditions as were applied to options granted to Vice
Presidents of Cincinnati Bell Telephone Company in 1988. Pursuant to the terms
of the 1988 Plan, such options will become immediately exercisable upon a Change
in Control, as defined therein.
(B) After calendar year 1989, Employee may participate in CBI's 1988
Plan or any similar stock option plan established by CBI, subject to the actions
of the Compensation Committee.
(C) After satisfying the applicable waiting periods and while the
Employee remains in the employ of the Employer, Employee shall be entitled to
participate in all of the various employee benefit plans in which Vice
Presidents of Cincinnati Bell Telephone Company are participating, with the
exceptions that Employee shall not receive a cellular telephone or concession
telephone service. In addition, Employer shall provide Employee with the
following benefits:
(1) SAVINGS PLAN FOR SALARIED EMPLOYEES. Within 30 days of the
execution of this Agreement by Employer and Employee, Employer shall compensate
Employee for the period he is not eligible to participate in the Savings Plan
for Salaried Employees by paying to Employee a sum equal to (a) the amount that
Employer would have
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contributed to such Savings Plan for Employee's account if Employee had fully
participated therein plus (b) the amount of tax incurred by Employee on such
payment.
(2) WELFARE PLANS - GENERAL. In the case of each employee
welfare benefit plan in which Vice Presidents of Cincinnati Bell Telephone
Company are participating, prior to satisfying any waiting period called for in
the plan and while Employee remains in the employ of Employer, Employer shall
provide Employee with benefits which are at least equivalent to the benefits
Employee would have been entitled to receive under the plan if he had been
eligible to participate in the plans.
(3) LONG TERM DISABILITY PLAN FOR SALARIED EMPLOYEES AND THE
SICKNESS AND ACCIDENT DISABILITY BENEFIT PLAN. While Employee remains in the
employ of Employer, Employer shall provide Employee with benefits which are at
least equivalent to the benefits Employee would have been entitled to receive
under the Long Term Disability Plan for Salaried Employees and the Sickness and
Accident Disability Benefit Plan (a) assuming that he became eligible to
participate in the plans on January 1, 1989 and (b) assuming that he was
credited with 25 years of completed service as of January 1, 1989. The benefits
payable under this Section 6(B)(3) shall be reduced by any benefits paid under
the Long Term Disability Plan for Salaried Employees and the Sickness and
Accident Disability Benefit Plan.
(4) LIFE INSURANCE. For the first year of Employee's
employment, Employer will at its expense provide Employee with life insurance in
the basic amount of $200,000.
(5) MANAGEMENT PENSION PLAN. Subject to satisfying the
applicable waiting period, while Employee remains in the employ of Employer,
Employee shall participate in the Management Pension Plan. Employee's accrued
benefit under the Plan shall
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vest in accordance with the terms of the Plan. In the event that Employee is
employed by Employer on the Expiration Date but has not been credited with five
years of service, Employer and Employee agree that an equitable adjustment shall
be made.
(D) Notwithstanding anything contained herein to the contrary, the
Base Salary and Bonuses otherwise payable to Employee shall be reduced by any
benefits paid to Employee by Employer under Employer's Sickness and Accident
Disability Plan and Long Term Disability Plan for Salaried Employees or under
Section 6(B)(3) above.
7. PERFORMANCE AWARDS.
(A) If the net revenues of Newco from all sources (including
Telephone Marketing Services ("TMS"), whether or not contributed to Newco) for
its preceding fiscal year equal or exceed $30,000,000, Employee shall
immediately after the end of such fiscal year become entitled at all times
thereafter to receive a Performance Award (as defined in Section 7(B)) and the
Employee's Performance Award percentage shall be equal to 1%. Employee's
Performance Award percentage shall be increased to 2% if the net revenues of
Newco from all sources (including TMS, whether or not contributed to Newco) for
its preceding fiscal year equal or exceed $50,000,000. Only net revenues of TMS
in excess of the net revenues of TMS for the 12-month period ending June 30,
1988 may be included in calculating the $30,000,000 and the $50,000,000 amounts.
The Performance Award percentage to which Employee may become entitled under
this Section 7(A) shall hereafter be referred to as the "Performance Award
Percentage".
(B) Except as otherwise set forth in Section 7(C), upon Employee
ceasing to be an employee of Employer, or any other entity described in Section
14, for any reason (the last day of the month preceding such cessation hereafter
being referred to as the "Performance
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Award Date"), Employer shall pay a Performance Award to Employee in an amount
determined and on the terms as follows:
(i) The Performance Award shall be calculated based upon test
period net revenues and test period pre-tax earnings of Newco. For purposes
hereof, the test period is the period beginning one year before the Performance
Award Date (the date as of which the payment of the Performance Award by
Employer will be deemed to occur) and ending on the date one year after the
Performance Award Date. Test period net revenues shall equal the total net
revenues of Newco for such 24-month period divided by two. Test period pre-tax
earnings shall equal the pre-tax earnings for such 24-month period divided by
two. In calculating test period pre-tax earnings (or net revenues if such could
be affected), no deduction or adjustment shall be made for any repurchases of
Newco's Class B Common Shares from any holder of Class B Common Shares or for
the payment of the Performance Award to Employee or the payment of a similar
award to any other person, but deduction or adjustment shall be made for
salaries, bonuses, employee benefit plan obligations, other compensatory amounts
or reimbursement for employee expenses for any person who devotes substantially
all of his or her time, attention and energy to the business of Newco, whether
or not paid or accrued by Newco.
(ii) Net revenues and pre-tax earnings shall be calculated by
Employer using Employer's standard accounting principles and practices which
shall be in accordance with generally accepted accounting principles ("GAAP"),
as employed by Cincinnati Bell Information Systems, Inc. Net revenues shall be
defined as gross revenues from sales less uncollectible reserves. Pre-tax
earnings shall be defined as gross revenues less all expenses and costs of doing
business (including Employee's salary, bonus and benefits),
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except for federal income taxes; provided, however, that no deduction shall be
made for any payment of dividends by Newco at any time. For the purposes of
calculating net revenues and pre-tax earnings in computing the Performance Award
payable by Employer to Employee, interest shall be computed monthly at the prime
rate of Employer's primary bank as in effect for the last banking day of each
month during the test period, and deducted from gross revenues on the amount by
which Employer's capital investments in Newco exceed $30,000,000 (not including
Employer's contribution of TMS to Newco).
(iii) The amount of the Performance Award which Employer
shall pay to Employee shall be equal to the sum of the Revenue Component and the
Earnings Component, which sum is known as the "Performance Award". The Revenue
Component shall equal one-half of the test period net revenues of Newco
multiplied by the Employee's Performance Award Percentage. The Earnings
Component shall equal one-half of the test period pre-tax earnings of Newco
multiplied by each of (a) twelve and (b) the Employee's Performance Award
Percentage.
If Newco's test period pre-tax earnings are positive or zero, the
Performance Award shall be calculated pursuant to this Section 7(B)(iii) based
upon actual test period net revenues and pre-tax earnings as demonstrated by the
attached Table 1. Table 1 shall in no way be construed to limit the maximum
Performance Award payable to Employee.
If Newco's test period pre-tax earnings are negative, the Performance
Award shall be as set forth in one of the last two rows of Table 1 (such rows
are referred to as Row 1 and Row 2, respectively) based upon the range in which
test period pre-tax earnings losses fall, and (a) to the extent that actual
Newco test period net revenues are greater than $30,000,000 but less than
$50,000,000 (plus the amount of the net revenues of TMS for the
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12-month period ending June 30, 1988) and do not exactly correspond with any
entry in Row 1 or Row 2, the Performance Award shall be increased by (I) $.00375
for each additional $l.OO of net revenues, if Row 1 is applicable or (II) $.0025
for each additional $1.00 of net revenues, if Row 2 is applicable, or (b) to the
extent that actual Newco test period net revenues are $50,000,000 or greater
(plus the amount of net revenues of TMS for the 12-month period ending June 30,
1988) and do not exactly correspond with any entry in Row 1 or Row 2, the
Performance Award shall be increased by (I) $.0075 for each $1.00 of net
revenues, if Row 1 is applicable or (II) $.005 for each additional $1.00 of net
revenues, if Row 2 is applicable. In no event shall the Performance Award be
less than the minimum specified in Section 7(B)(v).
(iv) At the Performance Award Date, Employer shall compute the
Performance Award based upon (a) the actual net revenues and pre-tax earnings of
Newco for the preceding 12-month period as specified in Section 7(B)(i) above
and (b) Employer's reasonable, good faith estimate of the net revenues and
pre-tax earnings of Newco for the 12-month period following the Performance
Award Date (the "Subsequent Period"). Unless Employee and Employer otherwise
mutually agree, Employer shall pay Employee 80% of such estimated Performance
Award no later than 60 days following the Performance Award Date. Thereafter,
Employer shall recompute the Performance Award at the end of the Subsequent
Period based upon the actual net revenues and pre-tax earnings of Newco for such
period. Unless Employee and Employer otherwise mutually agree, no later than 60
days following the end of the Subsequent Period, Employer or Employee, as
appropriate, shall pay the other the difference between 80% of the estimated
Performance Award originally paid and the final Performance Award computed at
the end of the Subsequent Period. In the event of a
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disagreement between Employer and Employee as to Employer's determination of the
final Performance Award, Employee and Employer shall jointly select a nationally
recognized independent accounting firm which shall determine the final
Performance Award and such determination shall be binding upon the parties
hereto.
(v) Notwithstanding anything to the contrary contained in this
Section 7(B), the minimum Performance Award shall be $300,000.
(C) Employer shall pay any Performance Award earned by Employee
pursuant to Section 7(A) and (B), adjusted as set forth in this Section 7(C).
If Employee ceases to be an employee of Employer (i) on or before the last day
of the two-year period commencing from the Effective Date, no Performance Award
shall be paid to Employee; (ii) at any time after the last day of the period
described in Section 7(C)(i) but on or before the last day of the three-year
period commencing from the Effective Date, Employer shall pay Employee the
Performance Award as calculated pursuant to Section 7(B) multiplied by the sum
of .50 and one-half times a fraction having as its numerator the number of days
elapsed in the current one-year period through the Performance Award Date and
having 365 as its denominator; or (iii) at any time after the last day of the
period described in Section 7(C)(ii), Employer shall pay Employee the full
Performance Award as calculated pursuant to Section 7(B).
8. CONFIDENTIAL INFORMATION AND MATERIALS.
(A) As used herein, the term "confidential information and materials"
refers to all information belonging to, used by or in the possession of Employer
and Newco now and in the future relating to their present and/or future business
strategies, finances, methods of operation, customers, programs, marketing
plans, developmental plans, inventions,
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developments and trade secrets of every kind and character; provided, however,
that Employee shall not be obligated to treat as confidential any of the
information described in this Section 8(A) which is or becomes publicly
available or readily ascertainable from public sources or any information in
Employee's possession or knowledge prior to the Effective Date and not provided
to him by Employer or Newco.
(B) Employee hereby acknowledges that all of the confidential
information and materials are and shall continue to be the exclusive proprietary
property of Employer and Newco, whether or not prepared in whole or in part by
Employee and whether or not disclosed to or entrusted to the custody of
Employee. Employee further hereby acknowledges that all confidential
information and materials (to which Employee has had access or which Employee
has learned during his employment or to which Employee shall hereafter have
access or which he shall hereafter learn) have been disclosed to Employee solely
by virtue of Employee's employment with Employer and solely for the purpose of
assisting him in performing his duties for Employer and Newco.
(C) Employee hereby agrees that Employee will not, either during the
course of Employee's employment with Employer or at any time thereafter,
disclose any confidential information or materials of Employer or Newco, in
whole or in part, to any person or entity, for any reason or purpose whatsoever,
unless Employer and Newco shall have given their written consent to such
disclosure. Employee further agrees that Employee shall not use in any manner
other than for and in the course of Employee's furtherance of Employer's and
Newco's business, any confidential information or materials of Employer or Newco
for Employee's own purposes or for the benefit of any other person or entity
except Employer or Newco, whether such use consists of the duplication, removal,
oral use or disclosure, or the transfer of any
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confidential information or materials in any manner, or such other unauthorized
use in whatever manner, unless Employer and Newco shall have given their prior
written consent to such use.
9. NEW DEVELOPMENTS. Employee agrees that during the term of this
Agreement, Employee will promptly disclose to Employer and Newco any and all
improvements, inventions, developments, discoveries, innovation, systems,
techniques, ideas, processes, programs and other things which may be of
assistance to Employer or Newco, whether patentable or unpatentable, relating to
or arising out of any developments, services or products, or pertaining to in
any manner, the business of Employer or Newco, and made or conceived by
Employee, alone or with others, while employed by Employer, whether or not
conceived or made during his regular working hours (collectively referred to
hereinafter as the "New Developments"). Employee further agrees that all New
Developments shall be and shall remain the sole and exclusive property of
Employer and Newco and that Employee shall, upon the request of Employer or
Newco, and without further compensation, do all lawful things reasonably
necessary to ensure Employer's or Newco's ownership of such New Developments,
including without limitation the execution of any necessary documents assigning
and transferring to Employer, Newco or their assigns all of Employee's right,
title and interest in and to such New Developments, and the rendering of
assistance in the execution of all necessary documents required to enable
Employer or Newco to file and obtain patents, trademarks and copy rights in the
United States and foreign countries on any of such New Developments; provided,
however, that all expenses relating to the foregoing shall be borne by Employer
or Newco.
10. SURRENDER OF MATERIAL UPON TERMINATION. Employee hereby agrees that
upon
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cessation of his employment, for whatever reason and whether voluntary or
involuntary, he will immediately surrender to Employer or Newco all of
Employer's or Newco's property and other things of value in his possession or in
the possession of any person or entity under his control, that are the property
of Employer or Newco including without limitation all personal notes, drawings,
manuals, documents, photographs, or the like, including copies and derivatives
thereof, relating directly or indirectly to any confidential information or
materials or New Developments, or relating directly or indirectly to the
business of Employer or Newco.
11. REMEDIES. Employer and Employee hereby acknowledge and agree that the
services rendered by Employee to Employer and Newco and the information
disclosed to Employee during and by virtue of his employment, that Employee's
commitments and obligations to Employer and Newco herein are of a special,
unique and extraordinary character, and that the breach of any provision of this
Agreement will cause the non-breaching party irreparable injury and damage, and
consequently the non-breaching party shall be entitled to, in addition to all
other remedies available to it, injunctive and equitable relief to prevent a
breach of this Agreement, or any part of it, and to secure the enforcement of
this Agreement.
12. COVENANT NOT TO COMPETE. For the period ending on the second
anniversary of (i) the date of cessation of Employee's employment under this
Agreement or (ii) the date of the last payment of compensation to Employee, if
Employee's employment ceases as a result of a Terminating Disability pursuant to
Section 13(A), whether during or at the end of the term of this Agreement, or
for whatever time within that period found by a court of competent jurisdiction
to be reasonably necessary for the protection of Employer, Employee will not,
himself or together with other persons, directly or indirectly, own, manage,
operate, join, control or participate in the ownership, management, operation or
control of or become an
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employee of any business that engages in business-to-business telemarketing or
any other business of any type in which Employee is involved on behalf of
Employer or Newco immediately prior to the date of termination of this
Agreement. This restriction will apply throughout the continental United States
or whatever geographic scope found by a court of competent jurisdiction to be
reasonably necessary for the protection of Employer.
Employee hereby agrees (i) that the restrictions set forth in the paragraph
immediately above are founded on valuable consideration and are reasonable. in
duration and geographic extent in view of the circumstances in which this
Agreement is executed and are necessary to protect the legitimate interests of
Employer, and (ii) that the remedy at law for any breach of the foregoing
covenant will be inadequate and that Employer will be entitled to injunctive
relief in the event of any such breach. Nothing herein stated shall be
construed as prohibiting Employer from pursuing any other remedies available to
it for any such breach or threatened breach or for any other breach of this
Agreement, including the recovery of damages from Employee.
13. TERMINATION.
(A) Employer or Employee may terminate this Agreement upon Employee's
failure or inability to perform the services required hereunder because of any
physical or mental infirmity for which Employee receives disability benefits
under Employer's Sickness and Accident Disability Benefit Plan and/or Employer's
Long Term Disability Plan for Salaried Employees or under Section 6(C)(3)
hereof, as the case may be, (the "Plans") over a period of one hundred twenty
consecutive working days during any twelve consecutive month period (a
"Terminating Disability"). If Employer or Employee elects to so terminate this
Agreement in the event of a Terminating Disability, (i) such termination shall
be effective immediately
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upon the giving of written notice by the terminating party to the other, (ii)
Employer shall pay Employee, but in no event beyond the Expiration Date, (a) his
accrued compensation, whether Base Salary, Bonus or otherwise (subject to offset
for any amounts received pursuant to the Plans), (b) based upon the date of the
one hundred twentieth working day following the occurrence of the Terminating
Disability, the greater of (I) $300,000 or (II) the amount required pursuant to
Sections 7(B) and 7(C), and (c) for as long as such Terminating Disability may
exist, Employee shall continue to be an employee of Employer and Employer shall
provide Employee with disability benefits and all other benefits according to
the provisions of the Plans and any other Employer plans in which Employee is
then participating. If the parties elect not to terminate this Agreement upon
an event of a Terminating Disability and Employee returns to active employment
with Employer prior to such a termination, or if such disability exists for less
than one hundred twenty consecutive working days, the provisions of this
Agreement shall remain in full force and effect and the payment of the
Performance Award shall ultimately be made as if such disability had never
arisen. This Agreement terminates immediately and automatically on the death of
Employee, provided, however, that the Employee's estate shall be paid (a) the
greater of (I) $300,000 or (II) the amount required to be paid the Employee
pursuant to Sections 7(B) and 7(C), and (b) Employee's accrued compensation
hereunder whether Base Salary, Bonus or otherwise to the date of death. In
addition, upon Employee's death or Terminating Disability, Employee or his
estate shall be entitled to take whatever actions with respect to Employee's
stock options as may be permitted by the terms thereof, or by the plan under
which such options were granted, upon such death or disability.
(B) Either Employer or Employee may terminate this Agreement upon 30
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days written notice for any reason other than those reasons set forth in Section
13(A). In the event of termination for any reason other than as set forth in
Section 13(A), Employer shall pay Employee the greater of (i) the amount
required and as determined pursuant to Sections 7(B) and 7(C), or (ii) $300,000,
plus all accrued compensation to the date of such termination, whether Base
Salary, Bonus or otherwise.
(C) Upon Employer's payment of the required payments under this
Section 13, all further compensation under this Agreement shall terminate;
provided, however, that all qualified deferred compensation to which Employee
may be entitled to receive pursuant to any of Employer's pension or profit
sharing plans in which he may participate during his employment with Employer
shall be paid pursuant to the provisions of such plans at such times as any such
amounts become payable to Employee. It is further understood that for purposes
of this Section 13, the term "accrued compensation" shall include all
non-qualified deferred compensation, of whatever type or form, either previously
granted to Employee by Employer or otherwise earned or received by Employee.
The termination of this Agreement shall not amend, alter or modify the rights
and obligations of the parties under Sections 8, 9, 10, 11 and 12 hereof, the
terms of which shall survive the termination of this Agreement.
14. ASSIGNMENT. As this is an agreement for personal services involving a
relation of confidence and trust between Employer and Employee, all rights and
duties of Employee arising under this Agreement, and the Agreement itself, are
nonassignable by Employee except for the right of his estate to receive any
payments due Employee upon his death. Employer expressly reserves the right to
assign this Agreement to any other entity which is part of the same controlled
group of corporations, as defined in Section 1563 of the Internal Revenue Code
of 1986, as it may from time to time be amended or restated.
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15. NOTICES. Any notice required or permitted to be given under this
Agreement shall be sufficient, if in writing, and if delivered by the sending
party personally or by certified mail to Employee at his place of residence as
then recorded on the books of Employer or to Employer at its principal office.
16. WAIVER. No waiver or modification of this Agreement or the terms
contained herein shall be valid unless in writing and duly executed by the party
to be charged therewith. The waiver by any party hereto of a breach of any
provision of this Agreement by the other party shall not operate or be construed
as a waiver of any subsequent breach by such party.
17. GOVERNING LAW. This Agreement shall be governed by the laws of the
State of Ohio.
18. ENTIRE AGREEMENT. This Agreement contains the entire agreement of the
parties with respect to Employee's employment by Employer. There are no other
contracts, agreements or understandings, whether oral or written, existing
between them except as contained or referred to in this Agreement.
19. SEVERABILITY. In case any one or more of the provisions of this
Agreement is held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or other uneforceability shall not affect any other
provisions hereof, and this Agreement shall be construed as if such invalid,
illegal or unenforceable provisions had never been contained herein.
20. SUCCESSORS AND ASSIGNS. Subject to the provisions of Section 14
above, this Agreement shall be binding upon Employee, Employer and their
successors and assigns. Employer further expressly agrees that in the event it
shall merge or consolidate with, or be acquired by, any other entity, the
continuing entity resulting from such merger, consolidation
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or acquisition shall be obligated to perform the duties and obligations of
Employer as set forth in this Agreement. Employer further agrees that in the
event it should voluntarily dissolve and liquidate the assets and business of
Employer, it will undertake to have the terms and provisions of this Agreement
fulfilled prior to the distribution or disposal of Employer's assets.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
EMPLOYER:
CINCINNATI BELL INC.
By: /S/ RAYMOND R. CLARK
-----------------------
12-23-88
EMPLOYEE:
/S/ JAMES F. ORR
--------------------------
12-23-88
--------------------------
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TABLE 1: NEWCO PERFORMANCE AWARD
(M = Millions of Dollars)
Test Period Newco Revenues* 30M (1)(3) 40M (1)(3) 50M (1)(4)
R = .15M R = .2M R = .50M
- --------------------------------------------------------------------------------
8% E = .14M E = .192M E = .48M
T = .29M T = .392M T = .98M
- --------------------------------------------------------------------------------
5% E = .09M E = .12M E = .30M
T = .24M T = .32M T = .80M
- --------------------------------------------------------------------------------
3% E = .054M E = .072M E = .18M
T = .204M T = .272M T = .68M
- --------------------------------------------------------------------------------
0% E = 0 E = 0 E = 0
T = .15M T = .2M T = .50M
- --------------------------------------------------------------------------------
Less than 0% and *** E = -.0375 E = -.05 E = -.125M
higher or equal Row 1
to -4% T = .1125 T = .15M T = .375M
- --------------------------------------------------------------------------------
Lower than *** E = -.075 E = -.10 E = -.25M
- -4% Row 2
T = .075M T = .10M T = .25M
- --------------------------------------------------------------------------------
KEY: R = Revenue Contribution to Value
E = Earnings Contribution to Value
T = R + E
(1) To be increased by the amount of the net revenues of TMS
for the 12-month period ending June 30, 1988
(2) To be increased by the amount of the pre-tax earnings of
TMS for the 12-month period ending June 30, 1988
(3) Assumes 1% Performance Award Percentage
(4) Assumes 2% Performance Award Percentage
*Test period revenues and pre-tax earnings of Newco,
respectively, include those net revenues and pre-tax earnings of TMS whether or
not contributed to Newco, in excess of the net revenues and pre-tax earnings of
TMS for the 12 months period.