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EXHIBIT 10.3
NEXTLINK COMMUNICATIONS, INC.
CHANGE OF CONTROL RETENTION BONUS AND SEVERANCE PAY PLAN
1. General Statement of Purpose. The Board of Directors (the "Board") of
NEXTLINK Communications, Inc. (the "Company") has considered the effect that a
change of control of the Company may have on key employees of the Company and
its subsidiaries. Given the level of acquisition and change of control activity
in today's business environment, the Board recognizes and understands the
concerns such employees have for their careers. The possible occurrence of a
change-of-control transaction may cause key employees to consider major career
changes in an effort to assure financial security for themselves and their
families. The Company desires to assure fair treatment of its key employees in
the event of a change of control and to allow them to make critical career
decisions without undue time pressure and financial uncertainty, thereby
increasing their willingness to remain with the Company notwithstanding the
outcome of a possible change-of-control transaction.
The Company recognizes that the possibility of a change of control exists
and desires to assure itself of both the present and future continuity of
management, desires to establish certain retention and severance benefits for
certain of its Covered Employees (as defined below) applicable in a change of
control, and wishes to insure that its Covered Employees are not practically
disabled from discharging their duties in respect of a proposed or actual
transaction involving a change of control.
2. Effective and Termination Dates. The Plan shall be effective as of
February 16, 2000 (the "Effective Date"). The Plan will automatically terminate
when all benefits payable hereunder have been paid.
3. Definitions. Where the following words and phrases appear in the Plan,
they shall have the respective meanings set forth below:
(a) "Base Salary" means, with respect to each Covered Employee, the annual
base salary, exclusive of any bonus, special pay (including any retention pay)
or other benefits he or she may receive, but without giving effect to any salary
reductions authorized by the Covered Employee under any qualified or
non-qualified deferred compensation plan of an Employer, in effect (i) on the
date immediately preceding the date of the relevant Change of Control or (ii) on
the date of the Covered Employee's termination of employment with his or her
Employer, whichever is the highest.
(b) "Cause" shall mean with respect to any Covered Employee:
(i) conviction of a felony involving an intentional act of fraud,
embezzlement or theft in connection with his employment with an Employer;
(ii) intentional wrongful damage to property, contractual interests or
business relationships of an Employer;
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(iii) intentional wrongful disclosure of secret processes or
confidential information of an Employer in violation of any agreement with
or policy of the Employer; or
(iv) conduct contrary to an Employer's announced policies or practices
(including those contained in the Corporation's Employee Handbook) where
either:
(A) the nature and/or severity of the conduct or its consequences
typically would have resulted in immediate termination based on
the Corporation's established employee termination or
disciplinary practices in place before the Reference Date (as
defined in Section 3(h)(i) below); or
(B) the Covered Employee has been provided with written notice
detailing the relevant policy or practice and the nature of the
objectionable conduct or other violation and within 20 business
days of the receipt of such notice the Covered Employee has not
remedied the violation or ceased to engage in the objectionable
conduct.
For purposes of the Plan, no act or failure to act on the part of the Covered
Employee shall be deemed "intentional" if it was due primarily to an error in
judgment or negligence, but shall be deemed "intentional" only if done or
omitted to be done by the Covered Employee not in good faith and without
reasonable belief that his action or omission was in the best interest of his or
her Employer. Nothing herein will limit the right of the Covered Employee or his
beneficiaries to contest the validity or propriety of any such determination.
(c) "Change of Control" shall mean the occurrence of any of the following
events:
(A) The Company is merged or consolidated or reorganized into or
with another company or other legal entity, other than a merger
or consolidation or reorganization into or with an entity that
is an affiliate of Craig O. McCaw, and as a result of such
merger, consolidation or reorganization less than a majority of
the combined voting power of the then-outstanding securities of
such company or person immediately after such transaction is
held directly or indirectly in the aggregate by the holders of
voting securities of the Company immediately prior to such sale
or transfer, including voting securities issuable upon exercise
or conversion of options, warrants or other securities or
rights;
(B) The Company sells or otherwise transfers all or substantially
all of its assets to any other company or other legal entity,
other than such a sale or transfer to a company or legal entity
that is an affiliate of Craig O. McCaw, and as a result of such
sale or other transfer of assets, less than a majority of the
combined voting power of the then-outstanding securities of such
company or person immediately after such sale or transfer is
held directly or indirectly in the aggregate by the holders of
voting securities of the Company immediately prior to such sale
or transfer, including voting securities issuable upon exercise
or conversion of options, warrants or other securities or
rights;
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(C) There is a report filed on Schedule 13D or Schedule 14D-1 (or
any successor schedule, form or report), each as promulgated
pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), disclosing that any person (as the term
"person" is used in Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act) other than Craig O. McCaw and his affiliates has
become the beneficial owner (as the term "beneficial owner" is
defined under Rule 13d-3 or any successor rule or regulation
promulgated under the Exchange Act) of securities representing
50% or more of the voting securities of the Company, including
voting securities issuable upon exercise or conversion of
options, warrants or other securities or rights;
(D) The Company files a report or proxy statement with the
Securities and Exchange Commission pursuant to the Exchange Act
disclosing in response to Form 8-K or Schedule 14A (or any
successor schedule, form or report or item therein) that a
change in control of the Company has occurred;
(E) Notwithstanding the foregoing provisions of subparagraphs (C)
and (D) hereof, a "Change of Control" shall not be deemed to
have occurred solely because (x) the Company, (y) an entity in
which the Company directly or indirectly beneficially owns 50%
or more of the voting securities, or (z) any Company-sponsored
employee stock ownership plan or other employee benefit plan of
the Company, either files or becomes obligated to file a report
or proxy statement under or in response to Schedule 13D,
Schedule 14D-1, Form 8-K or Schedule 14A (or any successor
schedule, form or report or item therein) under the Exchange
Act, disclosing beneficial ownership by it of voting securities,
whether in excess of 50% or otherwise, or because the Company
reports that a change of control of the Company has or may have
occurred or will or may occur in the future by reason of such
beneficial ownership;
(F) Notwithstanding the foregoing provisions of subparagraphs (A)
through (D) above, no Change of Control shall result from a
merger, consolidation or reorganization of the Company with any
entity in which Eagle River Investments, L.L.C. has invested at
least $10,000,000 in equity prior to such merger, consolidation
or reorganization.
(d) "Code" means the Internal Revenue Code of 1986, as amended, or any
successor thereto.
(e) "Covered Employee" means any individual recognized by an Employer as a
regular full-time employee of an Employer who is subject to U.S. income tax
withholding to whom the Plan applies pursuant to Section 4(a) below.
(f) "Employee Benefits" means, with respect to any Covered Employee, all
life insurance, medical insurance (including dental and vision care) and
disability plans and programs in which the Covered Employee was entitled to
participate immediately prior to the relevant Change of Control.
(g) "Employer" means the Company, each of its wholly owned subsidiaries and
limited liability companies, any other subsidiary of the Company to which the
Plan has been extended by the Board (or by the Compensation Committee of the
Board) and which has adopted the Plan, and, as applicable, each such entity's
successor.
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(h) "Good Reason" means, with respect to any Covered Employee:
(i) any significant and adverse change in the Covered Employee's duties,
responsibilities and authority, as compared in each case to the
corresponding circumstances in place on the date immediately preceding the
first occurrence of a Change of Control after the Effective Date (the
"Reference Date"); or
(ii) a relocation of the principal work location at which the Covered
Employee is based on the Reference Date to a location more than 30 miles
away from such location; or
(iii) a reduction in Base Salary or bonus potential not agreed to by the
Covered Employee, or any other significant adverse financial consequences
associated with the Covered Employee's employment in comparison to the
corresponding circumstances in place on the Reference Date; or
(iv) a breach by any Employer of its obligations under any agreement to
which such Employer and the Covered Employee are parties, that remains
uncured after 20 business days following such Employer's receipt of a
written notice from the Covered Employee specifying the particulars in
reasonable detail.
Any good faith determination by the Covered Employee that "Good Reason" exists
will be presumptively correct for purposes of this Plan.
(i) "Plan" means the NEXTLINK Communications, Inc. Change of Control
Retention Bonus and Severance Pay Plan.
(j) "Retention Bonus" means the Retention Bonus described in Section 4(b).
(k) "Severance Compensation" means Severance Pay and other benefits provided
by Section 5(a) and (b).
(l) "Severance Pay" means the amounts payable as set forth in Section 5(a)
and (b).
(m) "Severance Period" means the period of time commencing on the date of
the first occurrence of a Change of Control and continuing until the earlier of
(i) the first anniversary of such date or (ii) the Covered Employee's death.
(n) "Target Bonus" means the amount obtained by multiplying the Covered
Employee's target bonus percentage as established and in effect for the Covered
Employee (i) on the Reference Date, or (ii) on the date of the Covered
Employee's termination of employment with his or her Employer, whichever is the
highest, by the Covered Employee's Base Salary.
4. Eligibility; Termination Following a Change of Control.
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(a) Subject to the limitations described below, the Plan applies to all
individuals who are recognized by an Employer as regular full-time salaried
employees in any of the following salary grade levels (as determined on February
16, 2000, and adjusting as appropriate for any changes to the Company's system
of classifying employees by salary grade level implemented subsequent to such
date): EX3, EX2, EX1, E8 and E7, who are employed by an Employer on or after the
date that (x) the Company enters into a definitive agreement providing for a
Change of Control, (y) a third party publicly announces a bona fide intention to
commence a tender offer for outstanding voting securities of the Company or
otherwise to take actions that are reasonably designed and expected to result in
a Change of Control or (z) a Change of Control otherwise occurs (the date
described in the foregoing clauses (x), (y) or (z), as appropriate, the "Trigger
Date").
(b) Subject to the last sentence of this Section 4(b), in the event of a
Change of Control, a Covered Employee shall be entitled to receive a Retention
Bonus in the amount described on Exhibit A for such Covered Employee. The
Retention Bonus shall be payable in two installments. The first installment
shall be paid on the effective date of any Change of Control. The second
installment shall be paid on the first anniversary of the relevant Change of
Control. Notwithstanding the foregoing, if a Covered Employee's employment is
terminated by an Employer after the occurrence of a Trigger Date, and a Change
of Control occurs prior to the first anniversary of such Trigger Date, then if
such termination is without Cause and before the full amount of the Retention
Bonus is paid to the Covered Employee, the Covered Employee shall be paid the
entire remaining portion of the Retention Bonus in full on the later of (x) the
effective date of the Change of Control or (y) the date of such termination of
employment. If a majority of the members of the Board in office on the date
immediately preceding the relevant Trigger Date (or a majority of the members of
the Compensation Committee thereof on such date) should determine (after
consultation with the Company's independent auditors) that the grant of any
right to receive a Retention Bonus pursuant to this Section 4(b) would prevent
the relevant proposed merger or other business combination transaction
contemplated to constitute a Change of Control (and intended by the Company and
the other party or parties thereto to be accounted for as a pooling of
interests) from meeting all criteria required for pooling of interests
accounting treatment, then such Board members (or members of the Compensation
Committee thereof) shall be authorized to modify the amount or any of the other
terms otherwise applicable to any Covered Employee's Retention Bonus, or the
group of Covered Employees entitled to receive any such Retention Bonus, but in
each case only to the extent determined to be necessary to permit such relevant
transaction to be accounted for as a pooling of interests.
(c) A Covered Employee will be entitled to the Severance Compensation
described in Section 5 if (i) the Covered Employee's employment is terminated by
an Employer during the Severance Period and such termination is without Cause
and is not described in Subsection (e) of this Section, or (ii) in the case of
each Covered Employee as to whom Exhibit B indicates that this Section 4(c)(ii)
applies to such Covered Employee, the Covered Employee voluntarily terminates
his employment with his Employer during the Severance Period for Good Reason.
(d) A termination of employment described in Subsection (c) of this Section
will not affect any rights that the Covered Employee may have pursuant to any
agreement, policy, plan, program or arrangement of the Company or any other
Employer providing Employee Benefits, which rights shall
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be governed by the terms thereof, except that any severance benefits provided
thereunder shall be reduced to the extent of the Severance Compensation actually
provided to such Covered Employee under and pursuant to this Plan.
(e) Notwithstanding the preceding provisions of this Section, a Covered
Employee will not be entitled to Severance Compensation if his employment with
an Employer is terminated during the Severance Period for Cause or because:
(i) of the Covered Employee's retirement or voluntary withdrawal from
employment, other than as described in Subsection (c)(ii) or Subsection
(c)(iii) of this Section;
(ii) of the Covered Employee's death;
(iii) the Covered Employee becomes permanently disabled within the
meaning of, and begins actually to receive disability benefits pursuant to,
the long-term disability plan in effect for, or applicable to, the Covered
Employee;
(iv) of the Covered Employee's failure to return to work after a
temporary lay-off; or
(v) of the Covered Employee's withdrawal or loss of employment due to
personal leave, other than as described in Subsection (c)(ii) or Subsection
(c)(iii) of this Section.
5. Severance Compensation.
(a) If a Covered Employee's employment is terminated in circumstances that
entitle the Covered Employee to Severance Compensation pursuant to Section 4(c),
the Company will pay to the Covered Employee as Severance Pay in a single lump
sum payment the amounts described on Exhibit C on the payroll date of the next
full payroll cycle after the termination date, and will continue to provide to
the Covered Employee the Employee Benefits for the period set forth on Exhibit
C.
(b) Without limiting the rights of a Covered Employee at law or in equity,
if the Company fails to make any payment or provide any benefit required to be
made or provided hereunder on a timely basis, the Company will pay interest on
the amount or value thereof at an annualized rate of interest equal to the
so-called composite "prime rate" as quoted from time to time during the relevant
period in the Eastern Edition of The Wall Street Journal plus the lesser of 5%
or the maximum rate of interest allowed by law. Such interest will be payable as
it accrues on demand. Any change in such prime rate or maximum rate will be
effective on and as of the date of such change.
(c) Notwithstanding any provision of the Plan to the contrary, the rights
and obligations under this Section and under Section 8 will survive any
termination or expiration of the Plan.
(d) Anything in this Plan to the contrary notwithstanding, but subject to
the last sentence of this Section 5(d), in the event that it shall be determined
that any payment or distribution of cash or other compensation or benefit by the
Company or any of its affiliates to or for the benefit of any Covered
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Employee, whether paid or payable or distributed or distributable pursuant to
the terms of this Plan or otherwise pursuant to or by reason of any other
agreement, policy, plan, program or arrangement (a "Payment"), would be subject
to the excise tax imposed by Section 4999 of the Code (or any successor
provision thereto), by reason of being considered "contingent on a change in
ownership or control" of the Company, within the meaning of Section 280G of the
Code (or any successor provision thereto) or to any similar tax imposed by state
or local law, or any interest or penalties with respect to such tax (such tax or
taxes, together with any such interest and penalties, being hereafter
collectively referred to as the "Excise Tax"), then the Covered Employee will be
entitled to receive from the Company an additional payment or payments
(collectively, a "Gross-Up Payment"). The Gross-Up Payment will be in an amount
such that, after payment by the Covered Employee of all taxes (including any
interest or penalties imposed with respect to such taxes), including any Excise
Tax imposed upon the Gross-Up Payment, the Covered Employee retains an amount of
the Gross-Up Payment equal to the Excise Tax imposed on the Payment. The
Gross-Up Payment shall be paid to the Covered Employee prior to the date on
which any Payment part or all of which is subject to the Excise Tax is made to
the Covered Employee. The Covered Employee shall cooperate in all reasonable
respects with the Company (but at the Company's sole cost and expense) to
attempt to minimize any such tax liability (such cooperation not to include
foregoing or deferring any payments or benefits to which he or she is otherwise
entitled), and if the Covered Employee later receives a refund of any part of
the Excise Tax, such Covered Employee shall promptly after receipt of such
refund pay back to the Company so much of the Gross-Up Payment as is required to
avoid a windfall. If a majority of the members of the Board in office on the day
immediately preceding the relevant Trigger Date (or a majority of the members of
the Compensation Committee thereof on such date) should determine (after
consultation with the Company's independent auditors) that the grant of any
right to receive a Gross-Up Payment pursuant to this Section 5(d) would prevent
the relevant proposed merger or other business combination transaction
contemplated to constitute a Change of Control (and intended by the Company and
the other party or parties thereto to be accounted for as a pooling of
interests) from meeting all criteria required for pooling of interests
accounting treatment, then such Board members (or members of the Compensation
Committee thereof) shall be authorized to modify the amount of or any of the
other terms otherwise applicable to any Covered Employees's right to receive a
Gross-Up Payment, but in each case only to the extent determined to be necessary
to permit such relevant transaction to be accounted for as a pooling of
interests.
6. No Mitigation Obligation. The Company hereby acknowledges that it will be
difficult for a Covered Employee to find reasonably comparable employment
following his termination of employment with his Employer. Accordingly, the
provision of Severance Compensation by the Company to a Covered Employee in
accordance with the terms of the Plan is hereby acknowledged by the Company to
be reasonable, and a Covered Employee will not be required to mitigate the
amount of any payment provided for in the Plan by seeking other employment or
otherwise, nor will any profits, income, earnings or other benefits from any
source whatsoever create any mitigation, offset, reduction or any other
obligation on the part of a Covered Employee hereunder or otherwise, except as
expressly provided in Section 4(b).
7. Certain Payments Not Considered for Other Benefits, etc. Payments of
Severance Pay will not be included as earnings for the purpose of calculating
contributions or benefits under any Employee Benefit plan of the Company or of
any other Employer. Such payments and payments of
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Severance Pay will not be made from any benefit plan funds, and shall constitute
an unfunded, unsecured obligation of the Company.
8. Arbitration. Any controversy or claim arising out of or relating to this
Plan or the breach thereof, shall be settled by arbitration in the Washington,
D.C. area in accordance with the laws of the State of Delaware by three
arbitrators, one of whom shall be appointed by the Company, one by the Covered
Employee and the third of whom shall be appointed by the first two arbitrators.
If the first two arbitrators cannot agree on the appointment of a third
arbitrator, then the third arbitrator shall be appointed by the Chief Judge of
the United States District Court for the Eastern District of Virginia. The
arbitration shall be conducted in accordance with the rules of the American
Arbitration Association, except with respect to the selection of arbitrators,
which shall be as provided in this Section 8. Judgment upon the award rendered
by the arbitrators may be entered in any court having jurisdiction thereof.
9. Employment Rights. Nothing expressed or implied in the Plan shall create
any right or duty on the part of an Employer or a Covered Employee to have the
Covered Employee remain in the employment of an Employer at any time prior to or
following a Change of Control.
10. Withholding of Taxes. The Company may withhold from any amounts payable
under the Plan all federal, state, city or other taxes as shall be required
pursuant to any law or government regulation or ruling.
11. Successors and Binding Effect.
(a) The Company shall require any successor (including without limitation
any persons acquiring directly or indirectly all or substantially all of the
business and/or assets of the Company whether by purchase, merger,
consolidation, reorganization or otherwise, and such successor shall be deemed
the Company for the purposes of the Plan) to assume and agree to perform the
obligations under the Plan in the same manner and to the same extent the Company
would be required to perform if no such succession had taken place. The Plan
shall be binding upon and inure to the benefit of the Company and any successor
to the Company, but shall not otherwise be assignable, transferable or delegable
by the Company.
(b) The rights under the Plan shall inure to the benefit of and be
enforceable by each Covered Employee's personal or legal representatives,
executors, administrators, successors, heirs, distributees and/or legatees.
(c) The rights under the Plan are personal in nature and neither the Company
nor any Covered Employee shall, without the consent of the other, assign,
transfer or delegate the Plan or any rights or obligations hereunder except as
expressly provided in this Section 11. Without limiting the generality of the
foregoing, a Covered Employee's right to receive payments hereunder shall not be
assignable, transferable or delegable, whether by pledge, creation of a security
interest or otherwise, other than by a transfer by his or her will or by the
laws of descent and distribution and, in the event of any attempted assignment
or transfer contrary to this Section, the Company shall have no liability to pay
any amount so attempted to be assigned, transferred or delegated.
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(d) The obligation of the Company to make payments and/or provide benefits
hereunder shall represent an unsecured obligation of the Company.
(e) The Company recognizes that each Covered Employee will have no adequate
remedy at law for breach by the Company of any of the agreements contained
herein and, in the event of any such breach, the Company hereby agrees and
consents that each Covered Employee shall be entitled to a decree of specific
performance, mandamus or other appropriate remedy to enforce performance of
obligations of the Company under the Plan.
12. Governing Law. The validity, interpretation, construction and
performance of the Plan shall be governed by the laws of the State of Delaware,
without giving effect to the principles of conflict of laws of such State.
13. Validity. If any provisions of the Plan or the application of any
provision hereof to any person or circumstance is held invalid, unenforceable or
otherwise illegal, the remainder of the Plan and the application of such
provision to any other person or circumstances shall not be affected, and the
provision so held to be invalid, unenforceable or otherwise illegal shall be
reformed to the extent (and only to the extent) necessary to make it
enforceable, valid and legal.
14. Captions. The captions in the Plan are for convenience of reference only
and do not define, limit or describe the scope or intent of the Plan or any part
hereof and shall not be considered in any construction hereof.
15. Construction. The masculine gender, where appearing in the Plan, shall
be deemed to include the feminine gender and the singular shall be deemed to
include the plural, unless the context clearly indicates to the contrary.
16. Administration of the Plan.
(a) In General: The Plan shall be administered by the Company, which shall
be the named fiduciary under the Plan.
(b) Delegation of Duties: The Company may delegate any of its administrative
duties, including, without limitation, duties with respect to the processing,
review, investigation, approval and payment of any Retention Bonus or Severance
Pay to a named administrator or administrators.
(c) Regulations: The Company shall promulgate any rules and regulations it
deems necessary in order to carry out the purposes of the Plan or to interpret
the terms and conditions of the Plan; provided, however, that no rule,
regulation or interpretation shall be contrary to the provisions of the Plan.
(d) Claims Procedure: Except as otherwise provided in the Plan (including,
without limitation, in the final sentence of the definition of the term "Good
Reason", in the final sentence of Section 4(b) and in the final sentence of
Section 5(d)), the Company shall determine the rights of any
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employee of the Company to any Retention Bonus or Severance Compensation
hereunder. Any employee or former employee of any Employer who believes that he
has not received any benefit under the Plan to which he believes he is entitled,
may file a claim in writing with the Human Resources Department of the Company.
The Company shall, no later than 90 days after the receipt of a claim, either
allow or deny the claim by written notice to the claimant. If a claimant does
not receive written notice of the Company's decision on his claim within such
90-day period, the claim shall be deemed to have been denied in full.
A denial of a claim by the Company, wholly or partially, shall be written in
a manner calculated to be understood by the claimant and shall include:
(i) the specific reason or reasons for the denial;
(ii) specific reference to pertinent Plan provisions on which the
denial is based;
(iii) a description of any additional material or information necessary
for the claimant to perfect the claim and an explanation of why such
material or information is necessary; and
(iv) an explanation of the claim review procedure.
A claimant whose claim is denied (or his duly authorized representative) may,
within 30 days after receipt of denial of his claim, request a review of such
denial by the Company by filing with the Secretary of the Company a written
request for review of his claim. If the claimant does not file a request for
review with the Company within such 30-day period, the claimant shall be deemed
to have acquiesced in the original decision of the Company on his claim. If a
written request for review is so filed within such 30-day period, the Company
shall conduct a full and fair review of such claim. During such full review, the
claimant shall be given the opportunity to review documents that are pertinent
to his claim and to submit issues and comments in writing. The Company shall
notify the claimant of its decision on review within 60 days after receipt of a
request for review. Notice of the decision on review shall be in writing. If the
decision on review is not furnished to the claimant within such 60-day period,
the claim shall be deemed to have been denied on review. The existence of the
claims determination and review procedures set forth in this Section 16(d) shall
not impose on any Covered Employee any obligation or requirement to exhaust his
remedies or to commence proceedings under this Section 16(d) prior to seeking an
arbitration of any controversy or claim pursuant to Section 8 hereof, nor shall
the provision of this Section 16(d) operate to limit any Covered Employee's
rights to seek or obtain specific performance or other remedies pursuant to
Section 11(e) hereof.
(e) Requirement of Receipt: Upon receipt of a Retention Bonus or any
Severance Compensation hereunder, the Company reserves the right to require any
Covered Employee to execute a receipt evidencing the amount and payment of such
Retention Bonus or Severance Compensation.
17. Amendment and Termination. The Company reserves the right, except as
hereinafter provided, at any time and from time to time, to amend, modify,
change or terminate the Plan,
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including any Exhibit hereto; provided, however, that except as expressly
permitted by the final sentences of Sections 4(b) and 5(d) hereof, after the
Effective Date, any such amendment, modification, change or termination that
adversely affects the rights of any Covered Employee under the Plan will not
take effect and be applicable to any Covered Employee if either (A) (1) a
Trigger Date (as defined in Section 4(a) of this Plan) occurs within six months
after the date on which such amendment, modification, change or termination is
made and (2) a Change of Control related to or growing out of the specific event
causing the occurrence of the Trigger Date occurs thereafter or (B) such
amendment, modification, change or termination is made at any time (1) during
the period between the occurrence of a relevant Trigger Date and the occurrence
of the related Change of Control related to or growing out of the specific event
causing the occurrence of the Trigger Date or (2) at or after the occurrence of
a Change of Control (and before all payments and benefits hereunder associated
with such Change of Control are paid or made available as contemplated herein),
without (in each of the circumstances described in the foregoing clauses (A) and
(B)) the written consent of such Covered Employee.
18. Other Plans, etc. If the terms of this Plan are inconsistent with the
provisions of any other plan, program, contract or arrangement of an Employer
with respect to any of the Covered Employees, to the extent such plan, program,
contract or arrangement may be amended by the Employer, the terms of the Plan
(insofar as they may be applicable to any such Covered Employee) will be deemed
to so amend such plan, program, contract or arrangement, and the terms of the
Plan will govern.
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NEXTLINK COMMUNICATIONS, INC.
CHANGE OF CONTROL RETENTION BONUS AND SEVERANCE PAY PLAN
EXHIBIT A
RETENTION BONUS
---------------
Position Retention Bonus
-------- ---------------
Top Management (Tier 1)(1) 150% of Base Salary plus 150%
of Target Bonus
Top Management (Tier 2)(2) 100% of Base Salary plus 100% of
Target Bonus
Other Senior Management(3) 50% of Base Salary
- --------
(1) All employees in employee classification EX3.
(2) All employees in employee classifications EX2 and EX1.
(3) All employees in employee classifications E8 and E7.
A-1
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NEXTLINK COMMUNICATIONS, INC.
CHANGE OF CONTROL RETENTION BONUS AND SEVERANCE PAY PLAN
EXHIBIT B
Covered Employees Subject to Section 4(c)(ii)
(terminations for "Good Reason")
Employees in employee classifications EX3, EX2 and EX1.
B-1
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NEXTLINK COMMUNICATIONS, INC.
CHANGE OF CONTROL RETENTION BONUS AND SEVERANCE PAY PLAN
EXHIBIT C
POSITION SEVERANCE PAY BENEFITS
- ---------------------------- -------------------------------------- -----------------------------------
Top Management(1) 200% of Base Salary and Target Bonus 2 Years
Other Senior Management(2) 100% of Base Salary and Target Bonus 1 Year
The above amounts shall be reduced by For any Covered Employee who becomes
any severance pay or allowance covered under another group health
mandated by statute or other law or plan, benefits under the Company's
other arrangement of or with the group health plan will be coordinated
Company; provided, however, that the as provided in the Company's plan.
above amounts are in addition to any
compensation to which a Covered
Employee may be entitled under the
notice provisions of the Worker
Adjustment and Retraining Notification
Act of 1988.
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(1) All employees in employee classifications EX3, EX2 and EX1.
(2) All employees in employee classifications E8 and E7.