EXHIBIT 4.7
EXECUTION COPY
EMPLOYMENT AGREEMENT
This AGREEMENT by and between Viatel Holding (Bermuda) Limited, a
company incorporated in Bermuda, whose registered office is at Cedar house, 41
Cedar Avenue, Hamilton, HM 12, Bermuda (the "Company"), and Lucy Woods of Kale
House, Reading Road, Mattingley, Hants RG27 8JY, UK (the "Executive"), dated as
of the 21st day of April 2004.
1. Employment Period. Subject to the purchase of the Notes by the
Investors and the Executive contemplated by the Investment Agreement, dated as
of the date hereof (the "Investment Agreement"), by and among Morgan Stanley &
Co. Incorporated, CFSC Wayland Advisers, Inc., Ahab Partners, L.P., Stonehill
International Partners, L.P., Ore Hill Hub Fund Ltd., Varde Partners, Inc.
(together the "Investors"), the Executive and the Company, the Company hereby
agrees to employ the Executive, and the Executive hereby agrees to be employed
by the Company, subject to the terms and conditions of this Agreement, with
effect from the Closing Date and continuing thereafter unless and until
terminated in accordance with Section 3. Capitalized terms used and not defined
herein shall have the meanings ascribed to such terms in the Investment
Agreement. The Executive's period of continuous employment commenced on 12 May
2003.
2. Terms of Employment.
(a) Position and Duties.
(i) During the Executive's employment under the terms of this
Agreement (the "Employment Period"), the Executive shall (A) serve as Chief
Executive Officer of the Company and a member of the Board of Directors of the
Company (the "Board"), with such duties and responsibilities as are commensurate
with such position taking into account the duties and responsibilities of the
Chairman of the Board of Directors (B) report to the Board. In addition, the
Executive agrees to serve, without additional consideration, as a director of
the board of directors of any of the Company's subsidiaries or any company or
other entity directly or indirectly controlled by or under common control with
the Company (collectively, the Company and such entities, the "Affiliated
Group"). The Company shall provide or procure that the Executive is provided
with directors and officers' liability insurance in relation to her appointment
as a director and officer of the Company which is substantially similar to that
provided to members of the Board in their capacities as directors of the Board
and with directors and officers' liability insurance in relation to her
appointment as a director or officer of any member of the Affiliated Group which
is substantially similar to that provided to members of the board of directors
of such member of the Affiliated Group.
(ii) During the Employment Period, the Executive shall devote
her full attention and time to the business and affairs of the Company and use
her reasonable endeavors to perform such responsibilities in a professional
manner. The Executive may serve on corporate boards of companies outside the
Affiliated Group subject to the reasonable approval of the Board, but only to
the extent any of such board memberships do not interfere with her duties to the
Company, represent a conflict of interest with the Company or violate Section 5
of this Agreement.
(iii) During the Employment Period, the Executive will work
during the Company's normal UK business hours, together with such additional
hours as may be reasonably necessary (with no further compensation) for the
proper performance of her duties. The Executive agrees in accordance with
Regulation 5 of the Working Time Regulations 1998 (the "Regulations") that the
provisions of Regulation 4(1) (which impose a cap on average weekly working
time) do not apply to the Executive and that the Executive will give three (3)
months' prior written notice if she wishes Regulation 4(1) to apply to her.
(iv) During the Employment Period, the Executive will be based
at the Company's principal UK offices (which, at the date of this Agreement, are
at Inbucon House, Wick Road, Egham, Surrey TW20 0HR) but will travel (both in
the United Kingdom and overseas) as reasonably required in the performance of
her duties. In the event that the principal offices of the Company are relocated
from the address specified in the previous sentence during the Employment Period
such that it becomes reasonably necessary for the Executive to relocate her
home, the Company will pay for or reimburse all reasonable expenses incurred by
the Executive and her family in undertaking the relocation of the Executive's
home and the personal effects and belongings of the Executive and her family
(including but not limited to any legal and estate agents fees and disbursements
incurred with the sale and purchase of suitable properties and charges incurred
in connection with the transportation of personal effects and belongings).
(b) Compensation and Benefits.
(i) Base Salary. During the Employment Period, the Company
shall pay the Executive an annual base salary of (pound)320,000 (the "Base
Salary"), payable in equal monthly installments . The Executive's Base Salary
shall be reviewed (upwards only) by the Board on or as soon as reasonably
practicable after 1 January each year during the Employment Period for the
purposes of determining the amount, if any, by which the Executive's salary
shall be increased.
(ii) Annual Incentive Compensation.
(A) Bonus Eligibility. Subject to clause (B) below, for each fiscal
year completed during the Employment Period, the Executive shall be
eligible to receive an annual cash bonus ("Annual Bonus") with a target of
125% of the Executive's Base Salary (as increased from time to time) as
set forth in this Agreement (the "Target Bonus") payable to the Executive
as set forth in Section 2(b)(ii)(C) of this Agreement. Any such Annual
Bonus shall be payable in pounds sterling. Any such Annual Bonus shall be
based on the amount of (i) consolidated revenue of the Company calculated
in accordance with generally accepted accounting principles ("Revenue")
for such fiscal year (or with respect to the Hurdle described below for
the applicable quarter) calculated in (pound)sterling and (ii) EBITDA -
Working Capital (as defined below) for such fiscal year (or with respect
to the Hurdle described below for the applicable quarter) calculated in
(pound)sterling, in each case as compared to the "goal" amount of Revenue
and EBITDA - Working Capital, respectively, planned for such year as set
forth in the materials previously provided to the Executive by the Company
(the "Plan"). Any such Annual Bonus will be determined by reference to the
amount, if any, that results under clause (B)(1), (2) or (3) plus the
amount, if any, that results under clause (B)(4), (5) or (6),
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below. For purposes of this Agreement, "EBITDA" shall mean the excess of
(x) Revenue over (y) the sum of (I) cost of sales (II) property costs and
rights of way, (III) repairs, maintenance lifts & shifts, (IV) staff costs
(excluding any stock-based compensation expense), (V) marketing, IR & PR
expenses, (VI) travel expenses, and (VII) other SG&A (excluding any
professional services, foreign exchange gains or losses, gain or loss on
sale of investments or fixed assets, receipts from bankruptcy estates and
"Working Capital" shall mean the excess of (X) Trade Accounts Receivable
over (Y) Trade Accounts Payable for cost of sales suppliers. The goals for
Revenue and EBITDA - Working Capital as set out in the Plan for the 2004
fiscal year have been agreed and have been provided in writing by the
Company to the Executive. The goals for Revenue and EBITDA - Working
Capital to be set out in the Plans for each subsequent fiscal year shall
be determined by the Company promptly after the end of each fiscal year
only after good faith discussions (undertaken with a view to reaching
agreement) with the Executive on the appropriate levels for such goals.
Any change from using Revenue and EBITDA-Working Capital as goals shall be
subject to agreement between the Executive and the Company. If a goal is a
negative number, then performance at less than 100% of the goal would be a
higher negative number than the goal.
(B) Calculation of Bonus. Subject to clauses (B)(7) and (B)(8)
below, the amount of the Annual Bonus shall be calculated as follows:
(1) If the Company's Revenue for the applicable fiscal year is
equal to or greater than 70% and less than 80% of the Revenue goal for the
applicable fiscal year as set forth in the Plan, the Executive shall have
earned an Annual Bonus of 50% to 74% of 50% of the Target Bonus.
(2) If the Company's Revenue for the applicable fiscal year is
equal to or greater than 80% and less than 100% of the Revenue goal for
the applicable fiscal year as set forth in the Plan, the Executive shall
have earned an Annual Bonus of 75% to 100% of 50% of the Target Bonus.
(3) If the Company's Revenue for the applicable fiscal year is
equal to or greater than 100% and is equal to or less than 110% of the
Revenue goal for the applicable fiscal year as set forth in the Plan, the
Executive shall have earned an Annual Bonus of 100% to 110% of 50% of the
Target Bonus. If the Company's Revenue for the applicable fiscal year is
greater than 110% of the Revenue goal for the applicable fiscal year as
set forth in the Plan, the Executive shall have earned an Annual Bonus of
110% of 50% of the Target Bonus.
(4) If the Company's EBITDA - Working Capital for the
applicable fiscal year is equal to or greater than 70% and less than 80%
of the EBITDA - Working Capital goal for the applicable fiscal year as set
forth in the Plan, the Executive shall have earned an Annual Bonus of 50%
to 74% of 50% of the Target Bonus .
(5) If the Company's EBITDA - Working Capital for the
applicable fiscal year is equal to or greater than 80% and less than 100%
of the EBITDA - Working
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Capital goal for the applicable fiscal year as set forth in the Plan, the
Executive shall have earned an Annual Bonus of 75% to 100% of 50% of the
Target Bonus.
(6) If the Company's EBITDA - Working Capital for the
applicable fiscal year is equal to or greater than 100% and is equal to or
less than 110% of the EBITDA - Working Capital goal for the applicable
fiscal year as set forth in the Plan, the Executive shall have earned an
Annual Bonus of 100% to 110% of 50% of the Target Bonus. If the Company's
EBITDA -- Working Capital for the applicable fiscal year is greater than
110% of the EBITDA -- Working Capital goal for the applicable fiscal year
as set forth in the Plan, the Executive shall have earned an Annual Bonus
of 110% of 50% of the Target Bonus.
(7) In each case set forth above, the percentage of the Target
Bonus earned will be interpolated on a pro-rata basis and rounded to the
nearest tenth of a percentage point based upon the percentage achievement
of the Revenue or EBITDA - Working Capital goal, as applicable, before
multiplying such percentage by the Target Bonus to determine the
(pound)sterling amount of the Annual Bonus; provided, that in no event
shall the Executive be eligible to earn an Annual Bonus in excess of 110%
of the Target Bonus.
(8) Notwithstanding the foregoing, the Executive shall not be
eligible to receive any Bonus unless the Hurdle (as defined below) shall
have been met. If the Hurdle is met in one fiscal year, it shall be deemed
to be satisfied for that and all subsequent fiscal years. The Hurdle will
be deemed to be met in any fiscal year only if both (x) the average of
quarterly Revenue for the third quarter and quarterly Revenue for the
fourth quarter for such fiscal year is equal to at least 69.39% of the
average of projected Revenue for the third quarter and projected Revenue
for the fourth quarter of such fiscal year, as set forth in the Plan and
(y) the average of quarterly EBITDA - Working Capital for the third
quarter and quarterly EBITDA - Working Capital for the fourth quarter for
such fiscal year is equal to at least 69.39% of the average of projected
EBITDA - Working Capital for the third quarter and projected EBITDA -
Working Capital for the fourth quarter of such fiscal year, as set forth
in the Plan.
(C) Allocation/Payment of the Annual Bonus. Subject to the
provisions of this Section 2(b)(ii)(C), prior to the second anniversary of
the date hereof, the Executive shall (and the Executive hereby agrees to)
purchase Notes from the Company having an aggregate principal amount (at
the date of issuance) of up to $520,000 (the "Total Investment Amount").
At or prior to the Closing Date, the Executive has purchased from the
Company Notes in the aggregate principal amount of $250,000 (the "Minimum
Investment Amount"). The Company hereby agrees that any Notes which
represent all or any part of the Additional Investment Amount (as defined
below) which are acquired by the Executive from the Company in accordance
with this Section 2(b)(ii)(C) will be subject to and have the benefit of
all of the terms and conditions (to the extent applicable to the Executive
under the terms of such Agreements) of the Shareholders Agreement dated as
of the date hereof among the Company, the Executive, the Investors (the
"Shareholders Agreement"), the Security Trust and Intercreditor Deed dated
as of the date hereof, by and among the Company, the Guarantors and The
Law Debenture Trust
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Corporation p.l.c and the Registration Rights Agreement dated as of the
date hereof among the Company, the Executive and the other Investors named
therein. In addition, on the date or dates of any such acquisition of
Notes which represent all or any part of the Additional Investment Amount
by the Executive, the Executive shall represent and warrant to the Company
as to herself only and not jointly on the terms contained in Article IV of
the Investment Agreement. The amount of the Total Investment Amount minus
the Minimum Investment Amount shall be referred to as the "Additional
Investment Amount." Notwithstanding the foregoing, the Executive shall not
be required to purchase any of the Additional Investment Amount in excess
of the aggregate after-tax amount of the Annual Bonuses for the 2004 and
2005 fiscal years (except that the Executive shall be permitted to
purchase such Additional Investment Amount prior to the end of fiscal year
2005 in excess of the aggregate after-tax amount of the Annual Bonuses for
the 2004 and 2005 fiscal years from her own funds if she wishes to do so).
In the event that an Annual Bonus is payable in respect of the 2004 fiscal
year, the entire after-tax amount of such bonus, if less than the
Additional Investment Amount, shall be used to purchase Notes to satisfy
this obligation. In the event that an Annual Bonus is payable in respect
of the 2005 fiscal year and the Executive has not (on or prior to the time
that such Annual Bonus would be payable) purchased the Additional
Investment Amount from the Company, up to the entire after-tax amount of
such bonus shall be used to purchase Notes from the Company to satisfy
this obligation. The Company shall have the right to effect such purchases
by setting off and reducing any Annual Bonus that is otherwise payable.
The Annual Bonus shall be converted from pounds sterling into US dollars
at the best (pound)sterling:US dollar exchange rate reasonably available
to the Company (as reasonably determined by the Board) on the date of
purchase of such Notes. From and after the time that the Minimum
Investment Amount has been purchased by the Executive from the Company,
any amounts not offset to effect any such purchase, and with respect to
any Annual Bonuses that are payable with respect to fiscal years following
2005, the Executive shall be paid such Annual Bonuses prior to the end of
the first fiscal quarter following the end of the fiscal year for which
the Annual Bonuses were earned (but in no event later than when bonuses
are paid to other Company executives); provided, that with respect to any
fiscal year for which the Executive has earned an Annual Bonus below 74%
of the Target Bonus (a "Minimum Bonus"), the Executive shall not be paid
the Minimum Bonus (or be permitted to use the Minimum Bonus to purchase
Notes from the Company to satisfy the Additional Investment Amount) until
the later of (i) the end of the first fiscal quarter following the end of
the fiscal year for which the Minimum Bonus was earned (but in no event
later than when bonuses are paid to other Company executives) and (ii) the
end of the fiscal quarter on or before the first quarter of 2006 in which
the Company achieves positive cash flow. In the event that the Company
does not achieve positive cash flow on or before the first quarter of
2006, the Executive shall forfeit all right to such Minimum Bonus.
(D) Adjustments. In the event that an extraordinary, unusual or
nonrecurring event affects the Company including, without limitation, if
the Company disposes of a segment of a business or changes accounting
principles or engages in a recapitalization such as a merger,
consolidation, separation, spin-off, or other distribution of stock or
property of the Company, the Board will consider equitably adjusting the
Hurdle and the EBITDA - Working Capital and Revenue performance goals. Any
such adjustment shall
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only be made following good faith consultations with the Executive during
which the Company will give the Executive the detailed reasons for any
such proposed adjustments and will consider in good faith any
representations made by the Executive in relation to any such proposed
adjustments. Any adjustments made by the Board shall be made or designated
at or about the time of the event causing the adjustment to be made.
(iii) Employee Benefits. During the Employment Period, the
Executive shall be eligible to participate in employee benefit plans as may be
adopted from time to time by VTL (UK) Limited ("VTL (UK)") on the same basis as
provided to similarly situated executives of VTL (UK) generally.
(iv) Insurance Benefits. During the Employment Period, the
Executive will be eligible to participate in the VTL (UK) standard private
medical health (for the benefit of the Executive and her family). The provision
of insurance benefits will be subject to and in accordance with the rules
governing such arrangements from time to time in force.
(v) Legal Fees. The Company will reimburse the Executive for
all legal fees (including VAT and disbursements) reasonably incurred by her in
taking advice in connection with the preparation and drafting of this Agreement,
the Shareholders Agreement, the Investment Agreement, the Security Trust and
Intercreditor Deed, the terms of the Notes and all associated documents and
otherwise generally in connection with the transaction contemplated by those
documents.
(vi) Pension. During the Employment Period, the Company will,
subject to any applicable Inland Revenue limits, pay an annual amount equal to
6% of the Executive's Base Salary (as amended from time to time) to a personal
pension arrangement of the Executive's choice, subject to the requirements of
applicable law. Such payment will be paid in equal monthly installments at the
same time as the Executive's Base Salary under Section 2(b)(i) is paid.
(vii) Car Allowance. During the Employment Period, the Company
will pay the Executive an annual amount (less required deductions) of
(pound)10,000 by way of car allowance. For the avoidance of doubt, the car
allowance shall not be pensionable. The car allowance will be paid in equal
monthly installments at the same time as the Executive's Base Salary under
Section 2(b)(i) is paid.
(viii) Expenses. During the Employment Period, the Executive
shall be entitled to prompt reimbursement for all reasonable business expenses
incurred by the Executive, in accordance with the policies provided to similarly
situated executives of the Company generally as may be in effect from time to
time.
(ix) Vacation. During the Employment Period, the Executive
shall be entitled to 25 working days' holiday per annum in addition to public
holidays in England and Wales. Holiday entitlement shall be pro-rated for any
part year of employment. Up to a maximum of five days of holiday may be carried
forward from one calendar year to the next. On termination of employment, the
Executive will be entitled to pay in lieu of any holiday entitlement outstanding
for the then current holiday year.
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(x) Management Incentive Plan. (i) Within six (6) months
following the Closing Date, subject to the prior relinquishment of all
outstanding stock options held by the Executive and any future promise of option
grants to the Executive upon execution of the Investment Agreement (other than
the contractual commitments contained in this Section 2(b)(i)(x)), the Company
shall establish the Plan. The "Plan" means an option, equity or cash bonus plan
pursuant to which the management team of the Company shall receive in respect of
vested awards in connection with a liquidity event (to be defined for purposes
of the Plan) a range of value (payable in cash or equity) equal to 5% of the
Equity Value at a liquidity event implying an Equity Value of $100 million, 10%
of the Equity Value at a liquidity event implying an Equity Value of (or in
excess of) $350 million (with interpolated values in between $100 million and
$350 million on a pro rata basis) and no value at a liquidity event implying an
Equity Value less than $100 million or if a liquidity event has not occurred
prior to the tenth anniversary of the date hereof. It is the intention of the
parties that any payment required to be made on the grant or exercise of awards
under the Plan would be nominal.
(ii) For these purposes "Equity Value" means the value of all
of the common stock of the Company that is outstanding on the date hereof , all
of the Notes issued in the transactions contemplated by the Investment Agreement
(including all issued Additional Notes (as defined in the terms of the Notes)
and Notes issued as Additional Investment Amount) and all of the stock issuable
(at the time of determination of Equity Value) on conversion of such Notes (as
the same may be adjusted as a result of stock splits or reverse stock splits)
and the value of all equity awards under the Plan outstanding as of the time of
such determination, provided that (A) equitable reductions in Equity Value will
be made to the extent that any such Notes have been repaid or repurchased prior
to the determination of Equity Value, (B) subject to the provisions of clause
(C), any additional equity or securities convertible into or exchangeable for
equity issued by the Company, whether through options, sales, in connection with
acquisitions or otherwise, shall be dilutive to the management team, and (C)
appropriate adjustments shall be made by the Board to protect the participants
against dilution (x) from the first $7.75 million of equity securities (or
securities convertible into or exchangeable for equity securities) of the
Company issued by the Company in respect of cash investments in the Company
(other than the sale to the Executive of the Additional Investment Amount) to
fund the Viatel Business Plan (other than any funding in connection with or as
consideration for the acquisition of assets, shares or businesses by the Company
or any subsidiary) following the initial sale of Notes by the Company pursuant
to the Investment Agreement (a "Business Plan Funding") (and against dilution
resulting from any adjustment to the conversion price of the Notes that is made
(after giving effect to any amendment or waiver by any Noteholder of any
antidilution provisions) as a result of any Business Plan Funding) and (y) from
the issuance of equity or securities convertible into or exchangeable for equity
of the Company in connection with or as consideration for any acquisition of
assets, shares or businesses by the Company or any subsidiary, but in the case
of this clause (y) only to the extent that, and on the same basis that, the
holders of Notes are also actually protected against dilution in such
transaction (after giving effect to any amendment or waiver by any Noteholder of
any antidilution provisions).
(iii) Awards under the Plan will vest in three tranches
(one-third on establishment of the Plan and one-third on each of the two
anniversaries of the Closing Date), subject to the Executive's continued
employment through each applicable vesting date. The Plan will provide that in
the event of the termination of the Executive's employment by the Company
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without Cause or by the Executive for Good Reason or by reason of the
Executive's death or Disability, the Executive will be entitled to immediate
accelerated vesting of the entire next tranche of the award that would have
vested on establishment of the Plan or the anniversary of the Closing Date
following the Date of Termination, if any. In the event that the Executive's
employment terminates for any other reason, the Executive will not be entitled
to vesting of any further tranches (or pro-rata proportions thereof) (it being
understood that vested and unvested awards will be subject to mechanisms to
ensure that the value received by the Executive does not exceed the value
contemplated to be received as set forth above).
(iv) The Executive's Awards will constitute 45% of all awards
available under the Plan. Bona fide consideration will be given to inclusion of
appropriate tag-along rights under the Plan. The Plan will have such other terms
not inconsistent with the foregoing as determined by the Board after
consultation with the Executive.
3. Termination of Employment.
(a) Death or Disability. The Executive's employment shall terminate
automatically upon the Executive's death during the Employment Period. If the
Company reasonably and in good faith determines that the Disability of the
Executive has occurred during the Employment Period (pursuant to the definition
of Disability set forth below), it may provide the Executive with written notice
in accordance with Section 7(b) of this Agreement terminating the Executive's
employment. In such event, the Executive's employment with the Company shall
terminate effective on the 30th day after receipt of such notice by the
Executive (the "Disability Effective Date"). For purposes of this Agreement,
"Disability" shall mean any physical or mental condition which would qualify the
Executive for a disability benefit under any long-term disability plan
maintained by VTL UK.
(b) Without Cause. The Company may only terminate the Executive's
employment during the Employment Period without Cause (other than by reason of
Disability) by either (i) giving the Executive 24 months' written notice (or
such lesser full months' written notice determined by the Company); or (ii)
terminating the Executive's employment without the notice required under Section
3(b)(i) and, in either case, paying to the Executive the sum specified in
Section 4(a) below.
(c) Cause. The Company may terminate the Executive's employment
during the Employment Period for Cause by giving a Notice of Termination in
accordance with Section 3(e). For purposes of this Agreement, "Cause" shall
mean:
(i) the Executive's continued failure to substantially perform
her duties under Section 2(a) of this Agreement, other than any such
failure resulting from the Executive's incapacity due to her physical or
mental illness; or
(ii) the Executive's engagement in any gross misconduct (which
materially damages or is reasonably likely to materially damage the
reputation or business of the Company or any other member of the
Affiliated Group or the reputation of the Executive in connection with her
position as Chief Executive Officer or director of the Company) or fraud;
or
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(iii) the Executive's charged with or convicted of a criminal
offense (other than a road traffic offense) punishable with at least three
months' imprisonment; or
(iv) the Executive becomes prohibited by law from being a
director of the Company due to the Executive's misconduct; or
(v) the Executive's material breach of Section 5(a) of this
Agreement or the Executive's failure to make the Minimum Investment Amount
when required to do so accordance with Section 2(b)(ii)(C); or
(vi) the Executive's willful failure or refusal to comply in
any material respect with any duly authorized and reasonable directive of
the Board or willful failure to comply with the Company's material
policies as in effect from time to time covering any of the following:
securities laws, code of ethics, equal opportunities and sexual
harassment, Company security, use of alcohol and illegal substances,
possession of illegal weapons or any additional topics that the Board
reasonably determines are material policies of the Company and
specifically notifies the Executive in writing that such policies are to
be considered material policies within the meaning of, and thus covered
by, this clause (vi).
(vii) the Executive's providing notice pursuant to the final
sentence of Section 2(a)(iii).
provided that, in relation to any event or circumstance in (i) to (vi) which is
capable of remedy by the Executive, the event or circumstance shall only
constitute "Cause" if the Company has first given written notice to the
Executive (specifically identifying the event or circumstance which the Company
believes constitutes Cause) giving the Executive 30 days from the date of such
notice in which to remedy the breach, and the Executive shall have failed to
remedy such breach within those 30 days, provided, further, that in the event
that the Executive's employment is terminated by the Company solely by reason of
the Executive being charged with a criminal offense under clause (iii) above and
the Executive is later finally acquitted of such charges or the charges against
the Executive are later finally dismissed, the Company will provide the
Executive with the benefits under Section 4(a) as if the date of such final
acquittal or dismissal, as the case may be, is the Date of Termination.
(d) Good Reason. The Executive may resign from employment during the
Employment Period with Good Reason. If (x) an event or circumstance set forth in
clauses (i) through (iv) below shall have occurred and the Executive provides
the Company with written notice thereof within 30 days after the Executive has
knowledge of the occurrence or existence of such event or circumstance, which
notice shall specifically identify the event or circumstance that the Executive
believes constitutes Good Reason, (y) the Company fails to correct the
circumstance or event so identified within 30 days after the receipt of such
notice, and (z) the Executive resigns within 90 days after the date of delivery
of the notice referred to in clause (x) above, the Executive shall be considered
to have resigned for Good Reason. For purposes of this Agreement, "Good Reason"
shall mean, in the absence of the Executive's prior written consent (and except
in consequence of a prior termination of the Executive's employment), the
occurrence of any of the following:
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(i) (x) the removal of the Executive from the position as
Chief Executive Officer of the Company (or, the removal of the Executive
as a director of the Board for any reason other than (A) Disability, (B)
death, (C) in connection with a termination for Cause, (D) in connection
with a termination by the Executive without Good Reason or (E) by the
Board or stockholders in a situation in which (1) Morgan Stanley owns more
than 50% of the outstanding principal amount of the Notes or more than 50%
of the outstanding shares of the Company's common stock and (2) Morgan
Stanley (or each of its employees that are directors of the Company) voted
against removal or voted in favor of her remaining on the Board) or (y)
any material diminution of the Executive's duties or responsibilities as
Chief Executive Officer as set forth in Section 2(a)(i)(A) (other than as
a result of the Executive's physical or mental incapacity), provided,
that, any diminution of the Executive's duties or responsibilities as
Chief Executive Officer or -------- removal from the Board which occurs as
a result of a Liquidity Event or Change of Control (as defined in the
Notes) shall not constitute Good Reason if the Executive is (or is
requested to be but she declines such position) the chief executive
officer (or similar position in an entity which is not a corporation) of
the Company (or the Company's successor), even if the Company or such
successor is a subsidiary of another entity; or
(ii) the Company's material breach of any of the provisions of
Section 2(b); or
(iii) the refusal by a purchaser of all or substantially all
of the assets of the Company to assume in writing and in a timely manner
the Company's obligations under this Agreement; or
(iv) the Company's requirement that the Executive relocate to
an office location outside of the United Kingdom.
(e) Notice of Termination. Any termination by the Company or by the
Executive shall be communicated by a Notice of Termination to the other party
hereto given in accordance with Section 7(b) of this Agreement. For purposes of
this Agreement, a "Notice of Termination" means a written notice which (i)
except in respect of a resignation by the Executive without Good Reason,
indicates the specific termination provision in this Agreement relied upon, (ii)
except in respect of a resignation by the Executive without Good Reason, sets
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive's employment under the provision so
indicated and (iii) specifies the Date of Termination (as defined below), which
date, in the case of a termination for Good Reason, shall comply with the
provisions of Section 3(c). The failure by the Company or the Executive to set
forth in the Notice of Termination any fact or circumstance which contributes to
a showing of Cause or Good Reason (respectively) shall not waive any right of
that party from asserting such fact or circumstance in enforcing that party's
rights hereunder.
(f) Date of Termination. "Date of Termination" means (i) if the
Executive's employment is terminated by the Executive for Good Reason, the date
that the Executive resigns during the 90-day period described in Section 3(d);
(ii) if the Executive's employment is
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terminated by the Company other than for Cause under Section 3(b)(i); the Date
of Termination shall be the expiry of the notice period provided in Section
3(b)(i); (iii) if the Executive's employment is terminated by the Company other
than for Cause under the provisions of Section 3(b)(ii), the Date of Termination
shall be the date on which the Company provides the Executive with a Notice of
Termination; (iv) if the Executive's employment is terminated by the Company for
Cause, the Date of Termination shall be the date on which the Company provides
the Executive with a Notice of Termination; (v) if the Executive's employment is
terminated by the Executive without Good Reason, the Date of Termination shall
be the date that is 30 days after the date on which the Executive provides the
Company with a Notice of Termination, provided that after the Company has
received such a Notice of Termination, the Company may terminate the Executive's
employment at any time prior to the date that is 30 days after it has received
such Notice of Termination and such termination of employment shall for all
purposes of this Agreement be deemed to be a resignation by the Executive
without Good Reason; and (vi) if the Executive's employment is terminated by
reason of death or Disability, the Date of Termination shall be the date of
death of the Executive or the Disability Effective Date, as the case may be.
(g) Resignation from All Positions. Notwithstanding any other
provision of this Agreement, upon the termination of the Executive's employment
for any reason, the Executive shall immediately resign as of the Date of
Termination from all positions that she holds or has ever held with the Company
and any other member of the Affiliated Group (and with any other entities with
respect to which the Company has requested the Executive to perform services),
including, without limitation, the Board and all boards of directors of any
member of the Affiliated Group. This obligation is without prejudice to any
claims the Executive may have against the Company arising from her employment or
the termination of her employment with the Company. The Executive hereby agrees
to execute any and all documentation to effectuate such resignations upon
request by the Company (and the Company is hereby irrevocably authorized to
appoint some person in her name and on her behalf to execute any documents or do
anything necessary or requisite to give effect to such resignations) and the
Company will use its reasonable endeavors to take such administrative actions
required to ensure such resignations are effected as soon as reasonably
practicable (including but not limited to ensuring that any such resignations
are notarized as required by local law), but she shall be treated for all
purposes as having so resigned upon termination of her employment, regardless of
when or whether she executes any such documentation.
(h) Garden Leave. In the event of termination of the Executive's
employment by the Company under the provisions of Section 3(b)(i), subject to
the Company's continued provision to the Executive of the Base Salary and other
contractual benefits in accordance with the terms of this Agreement, the Company
shall have, at its discretion, the right for a period not to exceed six months
or if shorter, the length of the notice period (the "Garden Leave Period") (i)
to exclude the Executive from any premises of the Company or any other member of
the Affiliated Group and require the Executive not to attend at any premises of
the Company or any other member of the Affiliated Group; and/or to require the
Executive to carry out no duties; and/or to require the Executive not to
communicate or deal with any employees, agents, consultants, clients or other
representatives of the Company or any other member of the Affiliated Group;
and/or (ii) to resign with immediate effect from any offices she holds with the
Company or any other member of the Affiliated Group (and any related
trusteeships); and/or to take any holiday which has accrued under Section
2(b)(viii) during the Garden Leave Period.
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The Executive shall continue to be bound by duties of good faith and fidelity
and the duties set forth in Section 5 of this Agreement during the Garden Leave
Period.
4. Obligations of the Company upon Termination. The Executive agrees
that the amounts payable under this Section 4 are in lieu of any other claims
the Executive may have with regard to the termination of her employment with the
Company and shall be the Executive's sole and exclusive remedy for any such
claims. The Executive agrees to execute and not to revoke a general release of
claims in the form attached hereto as Exhibit A (except for completion of the
appropriate matters in square brackets) in favor of the Company, its Affiliates
and shareholders and their employees and directors waiving any claims against
such entities or persons in connection with the Executive's employment or
termination of employment (other than any statutory claims) as a condition of
receipt of the amounts payable under this Section 4.
(a) Termination by the Company other Than for Cause/by the Executive
for Good Reason/by reason of the Executive's death or Disability. If the Company
terminates the Executive's employment without Cause under the provisions of
Section 3(b)(ii) above (or under section 3(b)(i) with less than 24 months
notice) or the Executive resigns for Good Reason or the Executive's employment
terminates by reason of the Executive's death or Disability, the Company will,
within 14 days of the Date of Termination, pay to the Executive (or the
Executive's estate, as the case may be) and the Executive will be contractually
entitled to receive a sum equal to the aggregate of the following (together the
"Severance Payment") (i) twice the Annual Base Salary in effect immediately
prior to the Date of Termination; and (ii) twice the last Annual Bonus paid to
the Executive in respect of a complete fiscal year of the Company (or, in the
event of a termination without Cause or resignation for Good Reason or
termination of employment due to death or Disability prior to determination of
an Annual Bonus in respect of the fiscal year 2004, twice the Target Bonus);
provided, that solely in the event of a termination of the Executive's
employment by reason of the Executive's death or Disability, the aggregate
amount payable under clauses (i) and (ii) shall in no event be less than $3
million. In addition, (except in the case of termination as a result of death)
the Company will procure that the Executive continues to participate in the
private medical plan for 24 months following the Date of Termination at the same
level of cover as was in place immediately prior to the termination of the
Executive's employment. If continued cover is not possible at the same level of
cover for all or any part of the 24 months period, the Company will pay to the
Executive a sum equal to the cost the Executive would have to incur to obtain
such insurance(s) cover in an individual capacity in the open market, subject to
a cost limit of (pound)35,000. The Executive shall also be entitled to receive
any Annual Bonuses earned in respect of any completed fiscal years preceding the
year in which the Date of Termination occurs (to the extent that any such Annual
Bonuses have not already been paid) to be calculated and paid in accordance with
Section 2(b)(ii). The severance obligation under this Section 4(a) shall be
reduced by the amount of compensation payments and insurance coverage received
by the Executive during the notice period given under Section 3(b)(i), if any.
In addition, both the Company and the Executive shall be released from any
obligation to sell or purchase, as the case may be, any Notes that have not yet
been purchased by the Executive in satisfaction of the Additional Investment
Amount and the restriction set forth in Section 5(h) shall lapse.
(b) Cause; Resignation without Good Reason; If (i) the Executive's
employment shall be terminated by the Company for Cause, or (ii) the Executive
shall resign
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without Good Reason, the Company shall pay or provide to the Executive to the
extent not theretofore paid or provided, the Executive's Annual Base Salary
through the Date of Termination. The Executive shall also be entitled to receive
any Annual Bonuses earned in respect of any completed fiscal years preceding the
year in which the Date of Termination occurs (to the extent that any such Annual
Bonuses have not already been paid) to be calculated and paid in accordance with
Section 2(b)(ii). In addition, in the event of a termination of employment as
set forth in subclauses (i) or (ii), both the Company and the Executive shall be
released from any obligation to sell or purchase, as the case may be, any Notes
that have not yet been purchased by the Executive in satisfaction of the
Additional Investment Amount and the restriction set forth in Section 5(h) shall
lapse.
5. Executive's Covenants.
(a) Confidential Information. The Executive shall hold in a
fiduciary capacity for benefit of the Affiliated Group, all secret or
confidential information, knowledge or data relating to the Affiliated Group and
its businesses (including, without limitation, any proprietary information
concerning any processes, methods, trade secrets, research or secret data,
costs, names of users or purchasers of their respective products or services,
business methods, operating procedures or programs or methods of promotion and
sale) that the Executive has obtained or obtains during the Executive's
employment by the Company that is not publicly available (other than as a result
of the Executive's violation of this Section 5(a)) ("Confidential Information").
For the purposes of this Section 5(a), information shall not be deemed to be
publicly available merely because it is embraced by general disclosures or
because individual features or combinations thereof are publicly available. The
Executive shall not communicate, divulge, disseminate, reproduce or otherwise
use Confidential Information at any time during or after the Executive's
employment with the Company, except (i) with prior written consent of the
Company, (ii) as required by law or legal process or (iii) as such disclosure or
use may be required in the course of the Executive performing her duties and
responsibilities as the Chief Executive Officer of the Company and is not in
violation of the reasonable policies of the Board. Notwithstanding the foregoing
provisions, if the Executive is required to disclose any such confidential or
proprietary information pursuant to applicable law or a subpoena or court order,
the Executive shall, to the extent that she is legally permitted to do so,
promptly notify the Company in writing of any such requirement so that the
Company or the appropriate member of the Affiliated Group may seek an
appropriate protective order or other appropriate remedy or waive compliance
with the provisions hereof. The Executive shall reasonably cooperate with the
Affiliated Group to obtain such a protective order or other remedy. If such
order or other remedy is not obtained prior to the time the Executive is
required to make the disclosure, or the Company waives compliance with the
provisions hereof, the Executive shall disclose only that portion of the
confidential or proprietary information which she is advised by counsel that she
is legally required to so disclose. Upon her termination of employment with the
Company for any reason, the Executive shall promptly return to the Company, all
records, files, memoranda, correspondence, notebooks, notes, reports, customer
lists, drawings, plans, documents, and other documents and the like relating to
the business of the Affiliated Group or containing any trade secrets relating to
the Affiliated Group or that the Executive uses, prepares or comes into contact
with during the course of the Executive's employment with the Company, and all
property supplied to the Executive by the Company including, without limitation,
any lap top computers, palm held electronic devices, cell phones, pagers, keys,
credit cards and passes, and such
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materials shall remain the sole property of the Company and/or the Affiliated
Group, as applicable.
(b) Non-Recruitment of Affiliated Group Employees. The Executive
will not, at any time during the period of 12 months following the Date of
Termination (reduced by the amount of time during which the Executive has been
suspended under Section 3(h)), without the prior written consent of the Company,
directly or indirectly
(i) solicit; or
(ii) recruit; or
(iii) employ
whether as an employee, officer, director, agent, consultant or independent
contractor any person who is at the Date of Termination an employee, officer or
director of the Company or of any other member of the Affiliated Group and who
is employed in an executive, managerial or technical position, and with whom the
Executive have had contact in the course of her employment at any time during
the 12 month period prior to the Date of Termination.
(c) No Competition -- Solicitation of Business. The Executive will
not, at any time during the period of six months following the Date of
Termination (reduced by the amount of time during which the Executive has been
suspended under Section 3(h)), without the prior written consent of the Company,
directly or indirectly, carry on, set up, be employed, engaged, concerned or
interested in any business which is or is about to be in competition with any
business carried on by the Company or any other member of the Affiliated Group
as at the Date of Termination and in which business the Executive was actively
involved at any time during the 12 month period immediately prior to the Date of
Termination (a "Competitive Activity") in any location in which the Affiliated
Group engages in a Competitive Activity.
(d) Non-Solicitation of Customers. The Executive will not, at any
time during the period of six months following the Date of Termination (reduced
by the amount of time during which the Executive has been suspended under
Section 3(h)), solicit or entice away or endeavor to solicit or entice away from
the Company or any other member of the Affiliated Group any person, firm,
company or other entity who is, or has been, in the 12 months immediately prior
to the Date of Termination a client or customer of the Company or any other
member of the Affiliated Group with whom the Executive had business dealings at
any time during the course of her employment in that 12 month period, so as to
cause such person, firm, company or other entity to cease doing business (or
reduce its levels of business) with the Company or any other member of the
Affiliated Group or to interfere with or seek to interfere in any way with such
person, firm, company or other entity's relationship with the Company or any
other member of the Affiliated Group.
(e) Non-dealing with Customers. The Executive will not, at any time
during the period of six months following the Date of Termination (reduced by
the amount of time during which the Executive has been suspended under Section
3(h)), have any business dealings with any person, firm, company or other entity
who is, or has been, in the 12 months
-14-
immediately prior to the Date of Termination a client or customer of the Company
or any other member of the Affiliated Group with whom the Executive had business
dealings at any time during the course of her employment in that 12 month
period, so as to cause such person, firm, company or other entity to cease to do
business (or reduce its levels of business) with the Company or any member of
the Affiliated Group or to interfere with or seek to interfere in any way with
such person, firm, company or other entity's relationship with the Company or
any other member of the Affiliated Group.
(f) Assistance. The Executive agrees that during and after her
employment by the Company, the Executive will assist the Affiliated Group in the
defense of any claims, or potential claims that may be made or threatened to be
made against any member of the Affiliated Group in any action, suit or
proceeding, whether civil, criminal, administrative, investigative or otherwise
other than by the Executive (a "Proceeding"), and will assist the Affiliated
Group in the prosecution of any claims that may be made by any member of the
Affiliated Group in any Proceeding, to the extent that such claims may relate to
the Executive's employment or the period of the Executive's employment by the
Company other than in relation to any such claims made by any member of the
Affiliated Group against the Executive which may relate to her employment or
period of employment. The Executive agrees, unless precluded by law, to promptly
inform the Company if the Executive is asked to participate (or otherwise become
involved) in any Proceeding involving such claims or potential claims. The
Executive also agrees, unless precluded by law, to promptly inform the Company
if the Executive is asked to assist in any investigation (whether governmental
or otherwise) of any member of the Affiliated Group (or their actions),
regardless of whether a lawsuit has then been filed against any member of the
Affiliated Group with respect to such investigation. The Company agrees to
reimburse the Executive for all of the Executive's reasonable out-of-pocket
expenses associated with such assistance, including travel expenses and any
attorneys' fees and shall pay a reasonable per diem fee for the Executive's
service. In addition, the Executive agrees to provide such services as are
reasonably requested by the Company to assist any successor to the Executive in
the transition of duties and responsibilities to such successor. It is agreed
that any obligation on the Executive to assist which arises after the
termination of the Executive's employment will be reasonably subject to any
commitments the Executive may have in any new employment or engagement.
(g) Remedies. The Executive acknowledges and agrees that the terms
of Section 5: (i) are reasonable in geographic and temporal scope, (ii) are
necessary to protect legitimate proprietary and business interests of the
Company in, inter alia, near permanent customer relationships and confidential
information. The Executive further acknowledges and agrees that (A) the
Executive's breach of the provisions of Section 5 will cause the Company
irreparable harm, which cannot be adequately compensated by money damages, and
(B) if the Company elects to prevent the Executive from breaching such
provisions by obtaining an injunction against the Executive, there is a
reasonable probability of the Company's eventual success on the merits. The
Executive consents and agrees that if the Executive commits any such breach or
threatens to commit any breach, the Company shall be entitled to temporary and
permanent injunctive relief from a court of competent jurisdiction, in addition
to, and not in lieu of, such other remedies as may be available to the Company
for such breach, including the recovery of money damages. If any of the
provisions of this Section 5 are determined to be wholly or partially
unenforceable in any jurisdiction, such determination shall not be a bar to or
in any way diminish the Company's right to enforce any such covenant in any
other jurisdiction.
-15-
(h) Restrictions on Transfer of Notes. During the Employment Period,
without the prior written consent of the Company or as otherwise required or
permitted pursuant to Section 3.3 and 3.4 of the Shareholder Agreement and to
members of the Executive's family or to limited partnerships, trusts or other
entities owned by or established for the benefit of such family members in
accordance with the Shareholders Agreement, the Executive shall not sell,
assign, transfer, exchange, pledge, hypothecate or otherwise encumber any Notes
(other than a transfer of the Notes to the Company upon conversion thereof) or
any shares of stock of the Company or other securities received in respect of
such Notes and no such sale, assignment, transfer, exchange, pledge,
hypothecation, or encumbrance, whether made or created by voluntary act of the
Executive or any agent of the Executive or by operation of law, shall be
recognized by, or be binding upon, or shall in any manner affect the rights of,
the Company. The Executive consents to the placement of an appropriate legend on
the Notes or other relevant securities evidencing this Agreement.
Notwithstanding the foregoing, the Executive shall be permitted to sell, assign,
transfer, exchange, pledge, hypothecate or otherwise encumber any Notes or any
shares of stock of the Company or other securities received in respect of such
Notes from and after the first date on which Morgan Stanley & Co. Incorporated
shall have transferred, sold or otherwise disposed for cash or freely tradable
securities that trade on an established securities exchange of (x) 20% or more
of the Notes issued to it on the Closing Date (as defined in the Investment
Agreement) or (y) a number of Conversion Shares (as defined in the Investment
Agreement) equal to the number of Conversion Shares issuable upon conversion of
20% of the Notes issued to it on the Closing Date.
(i) Intellectual Property.
(i) The Executive may make discover or create intellectual
property in the course of her duties to the Company and agrees that in this
respect she has a special obligation to further the interests of the Company.
(ii) Subject to the provisions of the Patents Act 1977 the
Registered Designs Act 1949 and the Copyright Designs and Patents Act 1988 if at
any time during the Employment Period the Executive makes or discovers or
participates in the making or discovery of any intellectual property relating to
or capable of being used in the business for the time being carried on by the
Company or any other member of the Affiliated Group (the "Intellectual
Property") full details of the Intellectual Property shall immediately be
communicated by her to the Company and shall be the absolute property of the
Company. At the request and expense of the Company, the Executive shall give and
supply all such information data drawings and assistance as may be requisite to
enable the Company to exploit the Intellectual Property to the best advantage
and shall execute all documents and do all things which may be necessary or
desirable for obtaining patent or other protection for the Intellectual Property
in such parts of the world as may be specified by the Company and for vesting
the same in the Company or as it may direct.
(iii) The Executive irrevocably appoints the Company to be her
agent in her name and on her behalf to sign execute or do any such instrument or
thing and generally to use her name for the purpose of giving to the Company (or
its nominee) the full benefit of the provisions of this clause and in favor of
any third party a certificate in writing signed by any
-16-
director or the secretary of the Company that any instrument or act falls within
the authority conferred by this clause shall be conclusive evidence that such is
the case.
(iv) If the Intellectual Property is not the property of the
Company, the Company shall subject to the provisions of the Patents Act 1977
have the right to acquire for itself or its nominee her rights in the
Intellectual Property within three months after disclosure pursuant to this
clause on fair and reasonable terms to be agreed or settled by a single
arbitrator.
(v) The Executive waives all of her moral rights (as defined
in the Copyright, Designs and Patents Act 1988) in respect of any acts of the
Company or any acts of third parties done with the Company's authority in
relation to any Intellectual Property which is the property of the Company by
virtue of this clause.
(vi) Rights and obligations under this clause shall continue
in force after termination of this Agreement in respect of Intellectual Property
made during the Executive's employment under this Agreement and shall be binding
upon her representatives.
6. Successors.
(a) This Agreement is personal to the Executive and without the
prior written consent of the Company shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive's legal
representatives.
(b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns. Except as provided in Section 6(c),
without the prior written consent of the Executive, this Agreement shall not be
assignable by the Company .
(c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. "Company" means the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid that assumes and agrees to
perform this Agreement by operation of law or otherwise.
7. Miscellaneous. (a) This Agreement shall be governed by and
construed in accordance with the laws of the England and Wales, without
reference to principles of conflict of laws. The Company and the Executive agree
to submit irrevocably to the exclusive jurisdiction of the courts of England and
Wales. The captions of this Agreement are not part of the provisions hereof and
shall have no force or effect. This Agreement may not be amended or modified
otherwise than by a written agreement executed by the parties hereto or their
respective successors and legal representatives.
(b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:
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If to the Executive:
at the Executive's address on the books and records of the Company
on the date of such notice
With a copy to:
LeBoeuf, Lamb, Greene & MacRae
No. 1 Minster Court
Mincing Lane
London EC3R 7YL
United Kingdom
Attn: Managing Partner
If to the Company:
At its registered address.
With a copy to:
VTL (UK)
Inbucon House
Wick Road
Egham, Surrey TW20 0HR
Attn: General Counsel
And an additional copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attn: David M. Silk
or to such other address as either of the parties shall have furnished to the
other in writing in accordance herewith. Notice and communications shall be
effective when actually received by the addressee. The Company agrees that VTL
(UK) will be irrevocably appointed as the Company authorized agent for the
purpose of accepting service of any process in England under or in connection
with this Agreement.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
(d) The Company may withhold from any amounts payable under this
Agreement (i) such taxes as shall be required to be withheld by any competent
taxing authority
-18-
pursuant to any applicable law or regulation and (ii) any sums which are owed
and payable by the Executive to the Company or any other member of the
Affiliated Group.
(e) To the extent that this Agreement becomes effective on the
Closing Date, as of the Closing Date, this Agreement shall supersede any other
agreement, written or oral, pertaining to the subject matter of this Agreement,
including without limitation all previous employment, severance, termination,
change of control or other similar agreements, including without limitation the
employment letter between the Executive and the Company dated as of May 9, 2003
(and the Company option commitment therein). The Executive acknowledges and
agrees that she is not entering into this Agreement in reliance on any
representation not expressly set out in this Agreement.
(f) This Agreement may be executed in several counterparts, each of
which shall be deemed an original, and such counterparts shall constitute but
one and the same instrument.
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IN WITNESS WHEREOF, this Agreement has been executed by the parties
on the date shown on the first page of this Agreement.
SIGNED as a DEED )
and DELIVERED by )
LUCY WOODS )
In the presence of: )
Witness signature:
Witness name:
Witness address:
Witness occupation:
___________________________________
Executive
VIATEL HOLDING (BERMUDA) LIMITED
By:______________________________
Name:
Title:
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Exhibit A
Form of General Release
This Agreement is made on [________]:
BETWEEN
(1) Viatel Holding (Bermuda) Limited (the COMPANY); and
(2) Lucy Woods (the EXECUTIVE)
WHEREAS
(A) The Executive has been employed by the Company under an employment
agreement (the EMPLOYMENT AGREEMENT) dated April 21, 2004;
(B) The Executive's employment pursuant to the Employment Agreement has
terminated in accordance with Section [to specify] of the Employment
Agreement;
(C) Pursuant to Section 4 of the Employment Agreement, the Executive's
entitlement to compensation on termination of her employment is
conditional upon her entering into a general release of claims in the form
set out in this Agreement;
(D) Definitions used in this Agreement shall have the same meaning as they
have in the Employment Agreement unless stated otherwise.
IT IS AGREED AS FOLLOWS:
In consideration of the payment to be made and benefits to be provided by the
Company to the Executive in accordance with Section [insert relevant subsection]
of the Employment Agreement, the Executive agrees with the Company (for itself
and as agent and trustee for and on behalf of each of its Affiliates, its or
their current of former shareholders, directors, officers or employees) that
she, on behalf of herself and her heirs, successors, spouses and assigns:
1.1 accepts the amount of (pound)[ ] and the benefits to be provided in
accordance with Section [insert relevant subsection] of the Employment Agreement
in full and final settlement of all Claims that the Executive has or may have
against the Company, any Affiliates or any of its or their current or former
shareholders (including without limitation Morgan Stanley & Co., Inc., its
affiliates, and each of their partners, directors, officers, employees,
representatives, contractors, attorneys, heirs, spouses, successors, assigns and
agents, in their individual and professional capacities), directors, officers,
employees or subsidiaries, partners, security holders, representatives,
contractors, attorneys, heirs, spouses, successors, assigns and agents in their
individual and professional capacities. For these purposes, Claim shall mean any
and all disputes, claims, actions, causes of action, damages, liabilities,
promises, debts, compensation, losses, obligations, costs and expenses of any
kind or nature, arising out of or in connection with
-21-
the Executive's employment with the Company or the termination of her
employment, directorship or other office held with the Company or any Affiliate
or resignation or removal therefrom (including claims which could be asserted by
way of contribution, counter-claim, set-off, indemnity or third party
proceedings, and any claims for interest and legal costs, but excluding any
statutory claims) whether such disputes or claims are asserted or known or not,
or existing or not, and whether or not such disputes or claims or the facts and
matters giving rise to them, could have been discovered as at the date of this
Agreement;
1.2 releases and forever discharges the Company, its Affiliates and any of its
or their current or former shareholders (including without limitation Morgan
Stanley & Co., Inc., its affiliates, and each of their partners, directors,
officers, employees, representatives, contractors, attorneys, heirs, spouses,
successors, assigns and agents, in their individual and professional
capacities), directors, officers, employees and subsidiaries, partners, security
holders, representatives, contractors, attorneys, heirs, spouses, successors,
assigns and agents in their individual and professional capacities from and
against any and all liabilities arising out of any Claim;
1.3 confirms that she will not make, bring or continue in any jurisdiction
against the Company, any of its Affiliates or any of its or their current or
former shareholders (including without limitation Morgan Stanley & Co., Inc.,
its affiliates, and each of their partners, directors, officers, employees,
representatives, contractors, attorneys, heirs, spouses, successors, assigns and
agents, in their individual and professional capacities), directors, officers,
employees, subsidiaries, partners, security holders, representatives,
contractors, attorneys, heirs, spouses, successors, assigns or agents in their
individual and professional capacities any civil claim, demand, action or
proceeding in respect of any Claim released or discharged under 1.2 above.
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