[LOGO OF GLOBAL CROSSING]
Employment Term Sheet - Gary Cohen
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Position: Chief Operating Officer, reporting to the CEO
Employer: Global Crossing Ltd. ('GCL')
Base Salary: $500,000 per year
Annual Bonus: Target bonus equal to 100% of base salary. Bonuses are
awarded in the sole discretion of GCL. Notwithstanding
the foregoing, the performance bonus for the 2000 plan
year, to be paid during the first quarter of 2001,
will be at least $500,000.
Signing Bonus: You will receive a signing bonus equal to $5,000,000.
The signing bonus will be reduced by the amount of any
gain realized from the exercise of any vested stock
options you have received from your previous employer
(i.e., the difference between the 'strike price' of
any such options and the price at which such shares
close on the date exercised or the actual selling
price on that date). You will provide the necessary
documentation to establish the amount of such realized
gain and the resulting reduced signing bonus amount
(the 'Net Signing Bonus'). The Net Signing Bonus will
be paid as follows:
50% on the later of 30 days after the employment start
date or 7 days after the Net Signing Bonus is
determined
25% on the first anniversary of your employment start
date;
15% on the second anniversary of your employment start
date; and
10% on the third anniversary of your employment start
date.
In the event that you resign without Good Reason or
are terminated for cause within one (1) year after
your employment start date, you agree to return to GCL
the first payment of the Signing Bonus, prorated on a
monthly basis for the period worked.
Global Crossing Ltd.
Stock Options: You shall receive 1,000,000 options to purchase common
stock of Global Crossing Ltd. (the 'Global Crossing
Stock Options'), vesting as follows:
25% on the employment start date
25% on the first anniversary of your employment start
date;
25% on the second anniversary of your employment start
date; and
25% on the third anniversary of your employment start
date.
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The exercise price for such options shall be $26.25
per share. Any unvested Global Crossing Stock Options
shall automatically cancel upon termination of
employment with GCL. Stock options will be granted
consistent with the terms and conditions of the 1998
Global Crossing Stock Incentive Plan (the 'Plan').
Employment
Start Date: You will start your employment with GCL on a date to
be determined by you but in no event later than May
16, 2000.
Benefits: Insurance benefits in accordance with company policy
as attached hereto as Exhibit 'A' including 401(k)
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plan participation.
Vacation: Four weeks. Maximum vacation accrual shall be four
weeks.
Annual Performance
Reviews: In conjunction with the annual performance review
process, you will be eligible for salary increases,
cash bonus awards and additional stock option awards.
The salary increases, cash bonus awards and stock
option awards will be determined based on overall
company performance, functional group performance and
individual performance. Stock options are awarded at
the discretion of GCL. The annual review process
currently takes place during the first quarter of each
calendar year and shall be conducted in the same
manner and utilizing the same standards as with other
senior corporate officers.
Employment
At-Will: Employment at GCL is at-will. You may resign at any
time and GCL may terminate your employment at any
time, with or without cause.
Termination Without
Cause or With Good
Reason: In the event you are terminated without cause or that
you resign your employment for Good Reason (as defined
below) before the first anniversary of your employment
start date, you shall receive an amount equal to two
(2) times the total of your annual base salary and
targeted bonus plus any remaining Signing Bonus
payments In the event you are terminated without cause
or that you resign your employment for 'Good Reason'
before the second anniversary of your employment start
date, you shall receive an amount equal to two times
(2) the total of your annual base salary and targeted
bonus based on the target percentage determined at the
beginning of the year in which the termination is
effective less any salary payments made to you between
the first anniversary and second anniversary of your
employment date plus any remaining Signing Bonus
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payments. In the event you are terminated without
cause or that you resign your employment for Good
Reason after the second anniversary but before the
third anniversary of your employment date, you shall
receive an amount equal to the total of your annual
base salary and targeted bonus based on the target
percentage determined at the beginning of the year in
which the termination is effective plus any remaining
Signing Bonus payments.
In the event that you are terminated without cause or
resign with Good Reason within one (1) year after a
Change in Control (as defined in the Plan), you will
receive a severance payment equal to three (3) years'
salary and bonus. The terms and conditions of the
Change in Control agreement shall be the same as other
corporate officers.
'Good Reason' as used herein shall mean:
(i) a substantial reduction by GCL of your duties or
responsibilities or a change in your reporting
line; or
(ii) a reduction by GCL of your base salary or Annual
Bonus potential.
You must provide written notice to GCL within 20 days
after the occurrence of an event constituting Good
Reason. GCL shall have 20 days after receipt of
written notice to cure. If GCL fails to cure and you
resign within 30 days after the end of the 20-day cure
period, then such resignation shall constitute
resignation for Good Reason.
Termination For
Cause: 'Cause' as utilized herein shall mean:
(i) conviction of a felony; or conviction of a
crime of moral turpitude which causes serious
economic injury or serious injury to Global
Crossing's reputation; or
(ii) material breach of the Proprietary Information
Agreement attached hereto and incorporated
herein by reference as Exhibit 'B' ; or
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(iii) fraud or embezzlement; intentional misconduct;
or gross negligence which has caused serious
and demonstrable injury to Global Crossing or
its affiliates, except that a good faith
exercise of business judgment shall not be
deemed gross negligence; or
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(iv) egregious performance or failure to perform
your duties as Chief Operating Officer which
performance or failure to perform continues
beyond twenty-one (21) days after a written
demand for substantial improvement in your
performance, identifying specifically and in
detail the manner in which improvement is
sought, is delivered to you by GCL; provided
that a failure to achieve performance
objectives shall not by itself constitute
Cause.
Upon notice by GCL to you that it is terminating your
employment pursuant to a Termination for Cause, the
'Termination Date' shall be the date on which such
notice is mailed or hand-delivered, or as otherwise
specified in the notice of termination, to you. Upon
Termination for Cause, you shall not be entitled to
receive any further compensation or payments hereunder
(except for Base Salary relating to your services
prior to the Termination Date and any earned but
unpaid Annual Bonus payments. Any unvested Global
Crossing Stock Options shall immediately cancel as of
the Termination Date. Vested Global Crossing Stock
Options shall be subject to the provisions of your
stock option agreement and the Global Crossing stock
option Plan.
Withholdings: All payments set forth herein which are subject to
withholdings, shall be made less any required
withholdings.
Binding Arbitration: Any controversy arising out of or
relating to this Term Sheet or the Proprietary
Information Agreement shall be settled by binding
arbitration in accordance with the National Rules for
the Resolution of Employment Disputes of the American
Arbitration Association before a single arbitrator who
shall be a retired federal judge, and judgment upon
the award rendered may be entered in any court having
jurisdiction thereof. The costs of any such
arbitration proceedings shall be borne equally by GCL
and you. Neither party shall be entitled to recover
attorneys' fee or costs expended in the course of such
arbitration or enforcement of the award rendered
thereunder. The location for the arbitration shall be
New York City, New York.
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We look forward to you joining Global Crossing. Please sign below and return to
John Comparin via facsimile at 973-889-5970. If not fully executed on or before
April 26, 2000, this Term Sheet shall be void.
GLOBAL CROSSING LTD.
A Bermuda corporation
By: /s/ John L. Comparin
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Name: John L. Comparin
Title: SVP Human Resources
/s/ Gary Cohen
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GARY COHEN
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Employment Term Sheet - Global Crossing Ltd. and Gary Cohen
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