Exhibit 10(a)(10)
EMPLOYMENT AGREEMENT
Agreement, made and entered into as of the 1st day of March,
1995, by and between Vanguard Cellular Systems, Inc., a North
Carolina corporation (the "Company"), and HAYNES G. GRIFFIN (the
"Employee").
W I T N E S S E T H:
WHEREAS, the Company desires to assure the continuing services
of the Employee, the Employee desires to continue employment with
the Company, and each desires to enter into an agreement embodying
the terms of such employment;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein, the parties agree as follows:
1. Employment. The Company hereby employs the Employee, and
the Employee hereby accepts employment with the Company, for the
term set forth in paragraph 2 below, in the position and with the
duties and responsibilities set forth in paragraph 3 below, and
upon the other terms and conditions hereinafter stated.
2. Term. The term of this Agreement shall commence as
of the date hereof, and unless otherwise terminated as hereinafter
provided, shall continue for an initial term of three years and
from year to year thereafter until terminated by either party. The
Agreement may be terminated at the end of the initial term or at
the end of any subsequent year (a "Termination Date") by written
notice by either party to the other, given not less than one year
nor more than 15 months prior to the Termination Date reflected in
such notice.
3. Duties; Position. The Employee is engaged as President
and Chief Executive Officer of the Company. The Employee shall be
responsible for such duties as are commensurate with his office
that may from time to time be assigned to the Employee by the
Company's Board of Directors.
4. Compensation. In consideration of the services to be
rendered by the Employee to the Company and in consideration of the
Employee's other covenants hereunder, the Employee will receive an
initial base salary at the rate of $378,000 (such salary as it may
be increased from time to time being hereafter referred to as "Base
Salary"), payable at such intervals as may be established by the
Company from time to time for salary payments to its senior
management employees. The Employee shall receive such increases in
his Base Salary as the Board of Directors of the Company may from
time to time approve in its discretion, provided, however, that the
Employee's Base Salary will be reviewed not less often than
annually. No decreases in Base Salary may be effected without the
written consent of the Employee. The Employee shall also be
eligible to receive such bonuses as the Board of Directors may, in
its discretion, deem appropriate, from time to time.
5. Long-Term Incentive Compensation. The Company has
established the Executive Officer Long-Term Incentive Compensation
Plan, which, by its terms, is binding on the Company and continues
until 1998. The Employee is a participant in that Plan.
6. Employee Benefits. The Employee will be entitled to
participate, in accordance with the provisions thereof, in any
employee benefit plans and programs made available by the Company
to its executive management employees generally and the Company
agrees to continue, in a form no less favorable to the Employee,
those benefits currently in effect.
7. Business Expense Reimbursements. During the period of
his employment under this Agreement, the Employee will be entitled
to reimbursement for all reasonable out-of-pocket expenses incurred
by him in performing his duties hereunder upon presentation by the
Employee, from time to time, of an itemized account of such
expenses and appropriate documentation therefor.
8. Termination of Employment.
(a) Death. In the event of the death of the Employee during
his employment under this Agreement, the following payments shall
be made to the Employee's designated beneficiary, or, in the
absence of such designation, to the estate or other legal
representative of the Employee: (i) the Employee's Base Salary
shall be continued for a period of one year following the date of
his death, and (ii) such bonuses and incentive compensation as
shall have been earned by the Employee and not paid to him at the
time of his death. Any other rights and benefits the Employee's
estate or any other person may have under employee benefit plans
and programs of the Company in the event of the Employee's death
shall be determined in accordance with the terms of such plans and
programs.
(b) Disability. In the event of the disability of the
Employee during his employment under this Agreement (a
"Disability"), the Employee's Base Salary will be continued for a
period of one year following occurrence of the Disability or until
commencement of payments to the Employee equal to not less than 60%
of the Employee's Base Salary under the terms of disability
insurance provided by the Company for the benefit of the Employee,
whichever first occurs. For purposes of this Agreement,
"Disability" shall mean the inability, by reason of bodily injury
or physical or mental disease, or any combination thereof, of the
Employee to perform his customary or other comparable duties with
the Company. In the event the parties are unable to agree as to
whether the Employee is suffering a Disability, the Employee and
the Company shall each select a physician and the two physicians so
chosen shall make the determination or, if they are unable to
agree, they shall select a third physician, and the determination
as to whether the Employee is suffering a Disability shall be based
upon the determination of a majority of the three physicians. Any
other rights and benefits the Employee may have under employee
benefit plans and programs of the Company generally in the event of
the Employee's disability shall be determined in accordance with
the terms of such plans and programs.
(c) Termination for Cause. Nothing herein shall prevent the
Company from terminating the Employee's employment at any time for
Cause (as hereinafter defined). Upon termination for Cause, the
Employee shall receive his Base Salary only through the date of
termination, and neither the Employee nor any other person shall be
entitled to any further payments from the Company, for salary,
unpaid bonuses or any other amounts. Any rights and benefits the
Employee may have under employee benefit plans and programs of the
Company generally following a termination of the Employee's
employment for Cause shall be determined in accordance with the
terms of such plans and programs. For purposes of this Agreement,
termination for Cause shall mean termination due to (i) continued
willful or gross neglect of duties for 30 days following receipt by
the Employee of one or more written warnings from the Board of
Directors of the Company specifying in detail the duties neglected,
(ii) incapacity due to continuing alcohol or drug addiction, (iii)
continued intentional refusal to perform the duties for which
employed 30 days following receipt by the Employee of one or more
written warnings from the Board of Directors of the Company
specifying in detail the Employee's misconduct, (iv) fraud or
embezzlement committed against the Company, or (v) the Employee's
conviction for a felony.
(d) Termination Other Than For Cause. The Company may
terminate the Employee's employment under this Agreement at any
time upon written notice to the Employee for whatever reason it
deems appropriate, or for no reason. In the event such
termination by the Company occurs prior to a "change in control"
(as hereafter defined) and is not due to disability as provided in
paragraph 8(b) above or for Cause as provided in paragraph 8(c)
above, the Employee shall be entitled to the continuation of
payment of his Base Salary, at the rate in effect at the time of
such termination, and to all other benefits to which he is then
entitled hereunder or as an employee of the Company, including,
without limitation, the Executive Officer Long-Term Incentive
Compensation Plan. If such termination occurs following a "change
in control," the provisions of paragraph 8(e) shall govern in lieu
of this paragraph with respect to the amounts payable to the
Employee. In the event of a termination under this paragraph 8(d)
or under paragraph 8(e), the Employee shall be under no obligation
to attempt to mitigate the obligations of the Employee hereunder by
seeking other employment, nor will any income from any other source
be offset against any amounts due hereunder, and the Employee shall
be deemed to have earned the maximum amount payable to him under
the Executive Officer Long-Term Incentive Compensation Plan to the
extent such amounts relate to periods within the term of this
Agreement with all performance goals thereunder having been deemed
to have been satisfied, which amounts shall be paid to him under
that Plan as if his employment had continued.
(e) Change in Position or Employment Conditions; Termination
Other Than for Cause Following a Change in Control. The Employee
may terminate his employment immediately upon written notice to
the Company upon the occurrence, following a "change in control" of
the Company, of any one of the following events: (i) his authority
and/or responsibility are substantially reduced, without his
consent, below that described in paragraph 3, (ii) the Employee is
required to change his residence or principal place of business
from Greensboro, North Carolina, or (iii) the travel obligations
of the Employee are, without his consent, increased materially
above those in effect on the date of this Agreement. If the
Employee's employment is terminated pursuant to this paragraph 8(e)
or if the Employee's employment is terminated pursuant to paragraph
8(d) following a change in control, the Employee shall be entitled
to receive an amount equal a severance payment in an amount equal
to his average annual total cash compensation for the immediately
preceding five fiscal years of the Company, multiplied by 2.99 (the
"Severance Payment"). Upon entitlement, the Severance Payment will
be payable in cash or by certified check within thirty (30) days
following termination of the Employee's employment.
Notwithstanding anything to the contrary contained herein, in the
event that any portion of the Severance Payment received or to be
received by the Employee, together with any other payments received
by him, whether paid or payable pursuant to the terms of this Plan
or any other plan, arrangement or agreement with the Company or any
other person or entity, would not be deductible in whole or in part
by the Company in the calculation of its federal income tax by
reason of Section 280G of the Internal Revenue Code or would
cause, either directly or indirectly, an "excess parachute payment"
to exist within the meaning of said Section 280G, the Severance
Payment payable shall be reduced until no portion of the Severance
Payment would fail to be deductible by reason of being an "excess
parachute payment." In the event that any dispute arises as to
whether an "excess parachute payment" exists, the appropriate
calculations shall be made by the Company's regularly employed
independent public auditors and delivered to the Employee in
writing within 30 days following the date for payment of the
Severance Payment, and the Company will warrant to the Employee the
accuracy of the calculations and the information on which they are
based.
For purposes of this paragraph 8(e), a "change of control"
shall be deemed to have occurred upon the occurrence of any of the
following events:
(i) Any "person" (as such term is used in Sections 13(d)
and 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") but excluding any employee
benefit plan of the Company) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company
representing 50% or more of the combined voting power of the
Company's outstanding securities then entitled ordinarily (and
apart from rights accruing under special circumstances) to
vote for the election of directors; or
(ii) Individuals who are "Continuing Directors" (as
hereinafter defined) cease for any reason to constitute at
least a majority of the Board of Directors; or
(iii) The Board of Directors shall approve a sale of all
or substantially all of the assets of the Company; or
(iv) The Board of Directors shall approve any merger,
consolidation, or like business combination or reorganization
of the Company the consummation of which would result in the
occurrence of any event described in clause (i) or (ii) above.
For purposes of the foregoing, "Continuing Directors" shall
mean (i) the directors of the Company in office on the date hereof
and (ii) any successor to any such director (and any additional
director) who after the date hereof (y) was nominated or selected
by a majority of the Continuing Directors in office at the time of
his nomination or selection and (z) who is not an "affiliate" or
"associate" (as defined in Regulation 12B under the Exchange Act)
of any person who is the beneficial owner, directly or indirectly,
of securities representing 50% or more of the combined voting power
of the Company's outstanding securities then entitled ordinarily to
vote for the election of directors.
9. Covenants Not To Compete.
(a) The Employee hereby promises and agrees that during the
term of this Agreement or for a period of one year following the
termination of his employment with the Company, whichever later
occurs:
(i) He will not, directly or indirectly, own any interest in,
manage, operate, control, be employed by, render consulting or
advisory services to, or participate in or be connected with the
management or control of any business that is then engaged in the
operation of a cellular telephone system (or any competitive
communication system then operated by the Company) in competition
with the Company in the Territory;
(ii) He will not, directly or indirectly, influence or
attempt to influence any customer of the Company to discontinue its
use of the Company's services or to divert such business to any
other person, firm or corporation;
(iii) He will not, directly or indirectly, interfere with,
disrupt or attempt to disrupt the relationship, contractual or
otherwise, between the Company and any of its respective suppliers,
principals, distributors, lessors or licensors; and
(iv) He will not, directly or indirectly, solicit any
employee of the Company, whose base annual salary at the time of
the Employee's termination was $30,000 or more, to work for any
person, firm or corporation.
(b) It is the desire and intent of the parties that the
provisions of paragraph 9(a) shall be enforced to the fullest extent
permitted under the laws and public policies of each jurisdiction in
which enforcement is sought. Accordingly, if any particular portion
of paragraph 9(a) shall be adjudicated to be invalid or
unenforceable, such adjudication shall apply only with respect to the
operation of that portion in the particular jurisdiction in which
such adjudication is made, and all other portions shall continue in
full force and effect.
(c) It is expressly agreed that the provisions and covenants in
this paragraph 9 shall not apply and shall be of no force or effect
in the event that the Company fails to honor its obligations
hereunder.
(d) For purposes of this Section 9, the "Territory" shall mean
any geographic area in which the Company or any subsidiary of the
Company is operating a cellular telephone system immediately prior
to a "change in control" as defined in paragraph 8(e) of this
Agreement.
10. Injunctive Relief. The Employee acknowledges and agrees
that the Company would suffer irreparable injury in the event of a
breach by him of any of the provisions of paragraph 8 of this
Agreement and that the Company shall be entitled to an injunction
restraining him from any breach or threatened breach thereof.
Nothing herein shall be construed, however, as prohibiting the
Company from pursuing any other remedies at law or in equity which
it may have for any such breach or threatened breach of any provision
of paragraph 8 hereof, including the recovery of damages from the
Employee.
11. Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the Employee and his personal
representatives, estate and heirs and to the Company and its
successors and assigns, including without limitation any corporation
or other entity to which the Company may transfer all or
substantially all of its assets and business (by operation of law or
otherwise) and to which the Company may assign this Agreement. The
Employee may not assign this Agreement or any part hereof without the
prior written consent of the Company, which consent may be withheld
by the Company for any reason it deems appropriate.
12. Entire Agreement. This Agreement, together with any
agreements and similar documents entered into between the Company and
the Employee under any stock option, stock compensation or similar
employee benefit plans maintained by the Company, contains the entire
agreement of the parties with respect to the employment of the
Employee by the Company and supersedes and replaces all other
understandings and agreements, whether oral or in writing, if any,
previously entered into by the parties with respect to such
employment.
13. Amendment; Waiver. No provision of this Agreement may be
amended, modified or waived unless such amendment, modification or
waiver is agreed to in writing and signed by the Employee and by a
duly authorized officer of the Company. No waiver by either party
of any breach by the other party of any provision of this Agreement
shall be deemed a waiver of any other breach.
14. Notices. All notices or other communications given pursuant
to this Agreement shall be in writing and either delivered personally
or by prepaid registered or certified mail, return receipt requested.
Notices and other communications mailed to the Employee shall be
addressed to his last address as shown on the personnel records of
the Company, and notices and other communications to the Company
shall be addressed to Vanguard Cellular Systems, Inc., 2002 Pisgah
Church Road, Suite 300, Greensboro, North Carolina 27408, Attn:
Chairman. Either party may change the address to which notices are
to be mailed pursuant to this paragraph 13, by written notice given
in accordance herewith. Any notice pursuant to this paragraph 13
shall be effective for all purposes on the date delivered or mailed
as herein provided.
15. Severability. If any one or more of the provisions
contained in this Agreement shall be invalid, illegal, or
unenforceable in any respect under any applicable law, the validity,
legality and enforceability of the remaining provision shall not in
any way be affected or impaired thereby.
16. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws and judicial decisions of the
State of North Carolina.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the day and year first above written.
VANGUARD CELLULAR SYSTEMS, INC.
By:
(SEAL)
Haynes G. Griffin