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The following is an excerpt from a DEF 14A SEC Filing, filed by UBIQUITEL INC on 4/23/2003.
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UBIQUITEL INC - DEF 14A - 20030423 - COMMITTEE_INTERLOCKS

Compensation Committee Interlocks and Insider Participation

        No member of the compensation committee was at any time during the past fiscal year an officer or employee of us, was formerly an officer of us or any of our subsidiaries, or had any employment relationship with us.

        During the last fiscal year, none of our executive officers served as:

    a member of the compensation committee (or other committee of the board of directors performing equivalent functions or, in the absence of any such committee, the entire board of directors) of another entity, one of whose executive officers served on our compensation committee;

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    a director of another entity one of whose executive officers served on our compensation committee; or

    a member of the compensation committee (or other committee of the board of directors performing equivalent functions or, in the absence of any such committee, the entire board of directors) of another entity, one of whose executive officers served as a director of us.

Executive Officers

        The following table presents information with respect to our executive officers, as of April 4, 2003.

Name

  Age
  Position
Donald A. Harris   50   Chairman of the Board, President and Chief Executive Officer
Dean E. Russell   51   Chief Operating Officer
James J. Volk   39   Chief Financial Officer
Patricia E. Knese   44   Vice President, General Counsel and Secretary
Andrew W. Buffmire   56   Vice President—Business Development

        See "Nominees for Election as Directors" above for additional information concerning Mr. Harris.

         Dean E. Russell has been our Chief Operating Officer since November 1999. He is responsible for overseeing all of the functional areas of our operations including sales and marketing, network and field operations and human resources. Prior to joining us, Mr. Russell was part of the executive management team of Education Management Corporation from October 1997 to November 1999. He held various positions with Education Management Corporation including Director of Operations for the Art Institute of Fort Lauderdale and President of the Art Institute International at San Francisco. Previously, Mr. Russell was the General Sales Manager for Comcast Cellular Communications, Inc. in Atlantic City and Cape May County in New Jersey from October 1995 to October 1997. Prior to joining Comcast Cellular Communications, Inc., Mr. Russell served in the United States Army for 20 years before retiring as a Lieutenant Colonel. Mr. Russell has 29 years of leadership experience including hands on experience managing diverse operations. Mr. Russell holds a Bachelor of Science degree in Engineering from the United States Military Academy at West Point, a Master of Education degree from the University of Georgia and a Master of Business Administration degree in International Business from Long Island University.

         James J. Volk joined us as Chief Financial Officer in July 2001 and is responsible for all of the company's financial activities. Prior to that, he served as Regional Vice President of Finance and CFO of Cingular Wireless' East Region since September 2000 where he was responsible for all financial aspects of the region which provided service to approximately 4 million customers. He previously served as Vice President of Finance and CFO of Cingular's Philadelphia market from August 1999 to September 2000. Mr. Volk joined Cingular as Director of International Finance in January 1995 where he was responsible for all financial aspects of the international wireless operations and business development of the Comcast Cellular Division. He also served from May 1998 to August 1999 as Director of Strategic Marketing Planning, where he was responsible for planning and analysis as well as business development for the Comcast Cellular Division. Mr. Volk is a Certified Public Accountant and holds a Bachelor of Science degree in Accounting from the University of Delaware and a Master of Business Administration degree from Villanova University.

         Patricia E. Knese joined us in November 2000 as Vice President and General Counsel, and in February 2001 she was appointed Secretary of the company. From May 1999 to November 2000, Ms. Knese served as Head Transactions and E-Health Counsel for Aetna U.S. Healthcare Inc., the Hartford, Connecticut-based health benefits company, and as General Counsel for InteliHealth Inc., an Aetna Internet subsidiary, where she was responsible for mergers and acquisitions, strategic relationships and investments, and licensing and other e-commerce related legal matters. Prior to

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joining Aetna, from September 1993 to April 1999 she was an attorney at Morgan, Lewis & Bockius LLP's Philadelphia office in the Business and Finance area of the firm, and served prior to that as a federal judicial clerk for a one-year term with the chief judge of the United States District Court for the District of Delaware. She also has management experience in the automotive industry, including seven years with Subaru of America, Inc., and three years with Chrysler Corporation's Philadelphia zone office. Ms. Knese holds a Bachelor of Science degree in Management/Marketing from Saint Joseph's University, a Master of Business Administration degree from Drexel University and a Juris Doctor degree, summa cum laude , from Temple University School of Law.

         Andrew W. Buffmire joined us in May 2000 as Vice President—Business Development. He is responsible for the development and negotiation of strategic business transactions. Prior to joining us, Mr. Buffmire was a Director in the Sprint PCS Affiliates Program. He joined Sprint PCS in January 1996 during its initial development stage. At Sprint PCS he led the state-related regulatory compliance, network infrastructure and interconnection negotiations for the market entry of Sprint PCS and provided legal counsel for various aspects of the network build-out. Before joining Sprint PCS, Mr. Buffmire was an attorney in private legal practice in Salt Lake City, Utah for 16 years, with the exception of two years (1985-1987), when he was the founder, general counsel and registered principal of an NASD-registered investment banking firm. Mr. Buffmire interned with the Commission of the European Economic Community (EU) in Brussels, Belgium. He has a Bachelor of Arts degree in International Relations from the University of Southern California, a Juris Doctor degree from the University of Utah and a Master of Laws degree from the London School of Economics and Political Science.

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Summary Compensation Table

        The following table sets forth information concerning total compensation earned or paid to our Chief Executive Officer and our four most highly compensated executive officers who served in such capacities as of December 31, 2002, collectively referred to below as the "named executive officers," for the years ended December 31, 2002, 2001 and 2000:

 
   
  Annual Compensation
  Securities Underlying Option Awards (# of shares)(1)
   
 
Name and principal position

   
  All other Compensation
($)

 
  Year
  Salary($)
  Bonus($)
 
Donald A. Harris
Chairman, President and Chief Executive Officer
  2002
2001
2000
  221,308
210,000
201,154
  174,921
396,546
 

  5,500
4,961
2,112
(2)
(2)
(2)

Dean E. Russell
Chief Operating Officer

 

2002
2001
2000

 

219,863
195,000
181,154

 

150,492
200,535
155,400

 

200,000

300,000

 

12,419
4,928
138,442

(3)
(2)
(4)

James J. Volk
Chief Financial Officer

 

2002
2001
2000

 

165,000
76,154


(5)

130,350
76,901

 

100,000
200,000

 

3,342
2,094

(2)
(2)

Patricia E. Knese
Vice President and General Counsel

 

2002
2001
2000

 

177,231
160,000
18,462



(7)

79,200
113,697
10,000

 

100,000

75,000

 

19,348
2,445
554

(6)
(2)
(2)

Andrew W. Buffmire
Vice President—Business Development

 

2002
2001
2000

 

156,000
153,692
95,192



(8)

41,886
32,239
23,733

 



75,000

 

4,680
4,791
67,059

(2)
(2)
(9)

(1)
In June 2000, UbiquiTel granted Mr. Russell stock options to purchase up to 300,000 shares of common stock at an exercise price of $8.00 per share (which exercise price was reduced to $4.00 per share on May 2, 2002 as described under "—Report of the Compensation Committee on Repricing of Options"), vesting in four equal installments beginning on October 25, 2000 subject to earlier vesting upon a change of control, and in May 2002, UbiquiTel granted Mr. Russell stock options to purchase up to 200,000 shares of common stock at an exercise price of $1.86 per share, vesting in four equal installments beginning on May 2, 2003 subject to earlier vesting upon a change of control. In July 2001, UbiquiTel granted Mr. Volk stock options to purchase up to 200,000 shares of common stock at an exercise price of $7.20 per share (which exercise price was reduced to $4.00 per share on May 2, 2002 as described under "—Report of the Compensation Committee on Repricing of Options"), vesting in four equal installments beginning on July 16, 2002 subject to earlier vesting upon a change of control, and in May 2002, UbiquiTel granted Mr. Volk stock options to purchase up to 100,000 shares of common stock at an exercise price of $1.86 per share, vesting in four equal installments beginning on May 2, 2003 subject to earlier vesting upon a change of control. In November 2000, UbiquiTel granted Ms. Knese stock options to purchase up to 75,000 shares of common stock at an exercise price of $5.938 per share (which exercise price was reduced to $4.00 per share on May 2, 2002 as described under "—Report of the Compensation Committee on Repricing of Options"), vesting in four equal installments beginning on November 20, 2001 subject to earlier vesting upon a change of control, and in May 2002, UbiquiTel granted Ms. Knese stock options to purchase up to 100,000 shares of common stock at an exercise price of $1.86 per share, vesting in four equal installments beginning on May 2, 2003 subject to earlier vesting upon a change of control. In June 2000, UbiquiTel granted Mr. Buffmire stock options to purchase up to 75,000 shares of common stock at an exercise price of $8.00 per

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    share (which exercise price was reduced to $4.00 per share on May 2, 2002 as described under "—Report of the Compensation Committee on Repricing of Options"), vesting in four equal installments beginning on May 15, 2001 subject to earlier vesting upon a change of control.

(2)
Represents the amount contributed by UbiquiTel as a company match to the executive officer's 401(k) plan account.

(3)
Of such amount, $6,919 represents the value of a sales incentive trip and a gross up in salary to cover taxes paid in connection with the value of the trip and $5,500 represents the amount contributed by UbiquiTel as a company match to Mr. Russell's 401(k) plan account.

(4)
Of such amount, $36,417 represents relocation expenses reimbursed on a gross basis to Mr. Russell, $100,000 represents amounts advanced to Mr. Russell for relocation expenses and $2,025 represents the amount contributed by UbiquiTel as a company match to Mr. Russell's 401(k) plan account.

(5)
Mr. Volk's annualized salary was $165,000 for 2001, and the amount shown represents salary paid during 2001 beginning on his hire date of July 16, 2001.

(6)
Of such amount, $7,446 represents a paid time off payout to Ms. Knese, $7,264 represents the value of a sales incentive trip and a gross up in salary to cover taxes paid in connection with the value of the trip and $4,638 represents the amount contributed by UbiquiTel as a company match to Ms. Knese's 401(k) plan account.

(7)
Ms. Knese's annualized salary was $160,000 for 2000, and the amount shown represents salary paid during 2000 beginning on her hire date of November 20, 2000.

(8)
Mr. Buffmire's annualized salary was $150,000 for 2000, and the amount shown represents salary paid during 2000 beginning on his hire date of May 15, 2000.

(9)
Of such amount, $65,501 represents relocation expenses reimbursed on a gross basis to Mr. Buffmire and $1,558 represents the amount contributed by UbiquiTel as a company match to Mr. Buffmire's 401(k) plan account.

Report of the Compensation Committee on Repricing of Options

        On May 2, 2002, the compensation committee of UbiquiTel's board of directors approved the repricing of the exercise price to $4.00 per share of all stock options outstanding held by then current employees and directors under the company's amended and restated 2000 equity incentive plan with exercise prices over $4.00 per share. A total of 1,220,800 stock options were repriced at $4.00 per share, which was $2.14 per share above the May 2, 2002 closing sale price of $1.86 per share on the Nasdaq National Market. Therefore, after giving effect to the repricing, all of these stock options were still out of the money. All other terms and conditions of these stock options were unaffected by the repricing. As a result of the repricing, UbiquiTel will have to apply variable accounting treatment for these options until exercised, forfeited or cancelled upon expiration.

        The compensation committee believed that this repricing was necessary because equity incentives constitute a significant component of the total compensation package of our key employees and play a substantial role in our ability to retain the services of these individuals who are essential to our long-term financial success. The compensation committee felt that our ability to retain the services of these individuals would be significantly impaired, unless their out-of-the-money options were repriced. The compensation committee also felt that the repricing was a means to further align the interests of these individuals with those of our shareholders.

        The following table provides certain information with respect to the repricing of these stock options held by our named executive officers. There have been no other option repricings since

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June 2000 when UbiquiTel became a reporting company under Section 13(a) of the Securities Exchange Act of 1934.

10-Year Option Repricings

Name and Principle Position

  Date of Repricing
  Number of Securities Underlying Options Repriced
  Market Price of Stock at Time of Repricing ($)
  Exercise Price at Time of Repricing ($)
  New Exercise Price ($)
  Length of Original Option Term Remaining at Date of Repricing
Dean E. Russell
Chief Operating Officer
  05/02/02   300,000   1.86   8.00   4.00   89 months
James J. Volk
Chief Financial Officer
  05/02/02   200,000   1.86   7.20   4.00   110 months
Patricia E. Knese
Vice President and General Counsel
  05/02/02   75,000   1.86   5.94   4.00   102 months
Andrew W. Buffmire
Vice President—Business Development
  05/02/02   75,000   1.86   8.00   4.00   96 months

 

 

Members of the compensation committee
James E. Blake, Chair
Robert A. Berlacher
Peter Lucas
Joseph N. Walter

Stock Option Grants

        The following table sets forth grants of stock options to acquire shares of UbiquiTel's common stock made during the year ended December 31, 2002 to the named executive officers. No stock appreciation rights were granted to these individuals during that year.

 
  Individual Grants
   
  Potential Realizable Value at Assumed Annual Rates of Stock Price Appreciation for Option Term(2)
 
  Number of Securities Underlying Options Granted(1)
   
   
   
Name

  % of Total Options Granted to
Employees in Fiscal Year

  Exercise or Base Price
($)/(Sh)

  Expiration Date
  5%($)
  10%($)
Donald A. Harris            
Dean E. Russell   200,000   18.5 % 1.86   5/2/12   233,949   592,872
James J. Volk   100,000   9.3 % 1.86   5/2/12   116,974   296,436
Patricia E. Knese   100,000   9.3 % 1.86   5/2/12   116,974   296,436
Andrew W. Buffmire            

(1)
Subject to earlier vesting upon a change of control, the options vest annually in four equal installments beginning on May 2, 2003.

(2)
Potential realizable value is based on the assumption that the common stock price appreciates at the annual rate shown, compounded annually, from the date of grant until the end of the option term. The amounts have been calculated based on the assumed appreciation rates shown in the table, assuming a per share market price equal to the market price on the date of grant. The actual value, if any, the named executive officer may realize will depend on the excess of the stock

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    price over the exercise price on the date the option is exercised, if the executive were to sell the shares on the date of exercise, so there is no assurance that the value realized will be equal to or near the potential realizable value as calculated in this table.

Option Holdings

        The following table provides summary information regarding options held by each of our named executive officers as of December 31, 2002. No named executive officer exercised stock options during 2002.

 
  Number of Securities Underlying Unexercised Options
  Value of Unexercised In-the-Money Options(1)
Name

  Exercisable
  Unexercisable
  Exercisable
  Unexercisable
Donald A. Harris   2,540,000      
Dean E. Russell   450,000   350,000    
James J. Volk   50,000   250,000    
Patricia E. Knese   37,500   137,500    
Andrew W. Buffmire   37,500   37,500    

(1)
As of December 31, 2002, there were no unexercised in-the-money options, based on the closing sale price per share of UbiquiTel's common stock of $0.40 on December 31, 2002.

Employment Agreements

        In November 2002, we entered into a new employment agreement with Donald A. Harris, our Chairman of the Board, President and Chief Executive Officer, due to the expiration of the existing employment agreement between us. Mr. Harris' employment agreement is for a three-year term and provides for an annual base salary of $231,500, with a guaranteed minimum annual increase of 5%.

        If we terminate the employment of Mr. Harris without cause, within 30 days of termination (or such other date mutually agreed to) we must pay Mr. Harris a single lump sum payment in cash equal to one year's salary, plus all outstanding unreimbursed expenses. Following termination for a period of one year, we are required to maintain for Mr. Harris health, life insurance, long-term disability, dental and medical programs specified in the employment agreement. If we are required to make such payment within 24 months of a change of control (as defined in the employment agreement) or Mr. Harris is terminated without cause or terminates for good reason (each as defined in the employment agreement) due to, and within six months prior to, a change of control, Mr. Harris would be entitled to receive a lump sum cash payment (in lieu of any other payments), within 30 days of termination, equal to 2.99 times of Mr. Harris' annual gross salary and bonus for the year in which the change of control occurs or the immediately preceding year, whichever is higher. Mr. Harris would be entitled to health, life insurance, long-term disability, dental and medical program benefits for him and his family for the greater of 12 months or the remainder of the term as if his employment had not been terminated. Mr. Harris has agreed not to compete in the business of wireless telecommunications either directly or indirectly in our present and future markets during his employment. In addition, Mr. Harris has agreed not to disclose any of our confidential information and not to solicit any of our customers or employees during his employment and for a period of one year after his employment is terminated for any reason whatsoever.

        UbiquiTel entered into agreements with Dean E. Russell, our Chief Operating Officer, James J. Volk, our Chief Financial Officer, and Patricia E. Knese, our Vice President and General Counsel, upon their joining the company, to pay each of them one year's annual salary in the event of a change of control of the company in which the individual's employment is involuntarily terminated.

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Benefit Plans

        Amended and Restated 2000 Equity Incentive Plan.     UbiquiTel's 2000 equity incentive plan was adopted by UbiquiTel's board of directors and shareholders. The purpose of the equity incentive plan is to attract and retain the services of key management, employees, outside directors and consultants by providing those persons with a proprietary interest in us. The compensation committee administers the plan and may grant stock options, which may be incentive stock options or nonqualified stock options that do not comply with Section 422 of the Internal Revenue Code, stock appreciation rights, restricted stock and other equity-based awards to eligible persons with such terms and conditions as are determined by the committee. Up to a maximum of 7,500,000 shares of common stock of UbiquiTel are issuable under the plan. Awards paid in cash are not counted against the number of shares that may be issued under the equity incentive plan. The committee may grant one or more types of awards in any combination to a particular participant in a particular year, with certain limitations. The equity incentive plan provides for all awards granted under the plan to become fully vested and, if applicable, exercisable upon a change in control. Subject to earlier termination by our board of directors, the equity incentive plan will remain in effect until all awards have been satisfied in stock or in cash or terminated under the terms of the equity incentive plan and all restrictions imposed on stock in connection with its issuance under the equity incentive plan have lapsed.

        401(k) Retirement Plan.     We have established a tax qualified employee savings and retirement plan. Employees may elect to contribute up to 15% of their annual compensation on a pre-tax basis, subject to applicable federal limitations. "Highly Compensated Employees," as defined in the retirement plan, are subject to certain other provisions regarding the amount of eligible contributions. Employee contributions may begin on the date of hire and are immediately vested. Currently, we do make matching contributions to the retirement plan, and may in the future make profit sharing contributions if and when UbiquiTel becomes profitable.

        Amended and Restated 2002 Employee Stock Purchase Plan.     UbiquiTel's employee stock purchase plan was adopted by UbiquiTel's board of directors and shareholders. The purpose of the plan is to provide an incentive for our employees to purchase our common stock and acquire a proprietary interest in us. A committee of officers designated by UbiquiTel's board of directors administers the plan, though the board of directors may directly administer the plan in any regard in lieu of the committee. The rights to purchase our common stock granted under the plan are intended to qualify as options issued under an "employee stock purchase plan" as that term is defined in Section 423(b) of the Internal Revenue Code. Up to 1,000,000 shares of our common stock are issuable under the plan. Under the terms of the plan, during any calendar year there were four quarterly offering periods beginning January 1 st , April 1 st , July 1 st and October 1 st , during which eligible employees could participate. The purchase price was the lower of 85% of fair market value of our common stock on the first business day of the offering period or 85% of the fair market value of our common stock on the last business day of the offering period. In October 2002, our board of directors approved amendments to the plan, which, among other items, authorized the suspension of the plan. The plan was suspended effective with the offering period beginning January 1, 2003.

Noncompetition Agreements

        In connection with the granting of any stock options or equity-based awards under our equity incentive plan to any of our employees, each employee is required to enter into a noncompetition agreement. These agreements provide that for so long as the employee works for us, and for a period of one year after the employee's termination for any reason, the employee may not disclose in any way any confidential information. The agreements also provide that for so long as the employee works for

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us and for a period of one year after the employee's termination for any reason, the employee is prohibited from:

    engaging in the same business or in a similar capacity in our markets;

    soliciting business in competition with us; and

    hiring any of our employees or directly or indirectly causing any of our employees to leave their employment to work for another employer.

        In the event of a breach of the noncompetition agreement by an employee, we have the option to repurchase any and all shares held by the employee at the employee's exercise price. We also may pursue any other remedies provided by law or in equity.

Limitation on Liability and Indemnification Matters

        Our certificate of incorporation and bylaws limit the liability of directors and executive officers to the maximum extent permitted by Delaware law. The limitation on our directors' and executive officers' liability may not apply to liabilities arising under the federal securities laws. Our certificate of incorporation and bylaws provide that we shall indemnify our directors and executive officers and may indemnify our other officers and employees and other agents to the fullest extent permitted by law. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors and executive officers pursuant to our certificate of incorporation and bylaws, we have been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

        At present, there is no pending litigation or proceeding involving any of our directors, officers, employees or agents where indemnification will be required or permitted. We are not aware of any threatened litigation or proceeding that might result in a claim for such indemnification.

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EQUITY COMPENSATION PLAN INFORMATION

        The following table provides certain information as of December 31, 2002 with respect to all of our equity compensation plans in effect as of December 31, 2002.

Plan Category

  Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights(a)
  Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights(b)
  Number of Securities Remaining Available for Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column(a))(c)
Equity compensation plans approved by security holders              
  Amended and Restated 2000 Equity Incentive Plan   2,795,800   $ 2.56   4,689,200
  Amended and Restated 2002 Employee Stock Purchase Plan   0   $ 0   684,617
  1999 stock option grant to Donald A. Harris   2,540,000   $ 0.50   0
Equity compensation plans not approved by security holders   N/A     N/A   N/A
Total   5,335,800         5,373,817

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