exv10w8



 






Exhibit 10.8




EMPLOYMENT AGREEMENT



     This Employment Agreement is entered into by and among John H.
Jacquay (“Executive”) and XO Communications, Inc., a Delaware
corporation (the “Company” or “Employer”) this 20th day of November
2002 (the “Commencement Date”).



WITNESSETH:



     WHEREAS, the company is engaged in the business of providing
high-quality, non-mobile telecommunications services to the business
market; and



     WHEREAS, Executive has skills and experience in telephony
generally and with the technology associated with the Company’s
business specifically; and



     WHEREAS, Employer desires to obtain Executive’s services for the
conduct of the business of the Company, and Executive desires to be
employed in such business by and for Employer;



     NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein set forth, the parties hereto agree as follows:



     1. Employment. Employer acknowledges and agrees that it hired
Executive to serve as the President, National Sales for the company
(although Executive’s corporate office title is and shall continue to
be Senior Vice President, National Sales) as of February 22, 2002, and
that the parties have agreed to enter into this Employment Agreement as
of the Commencement Date and in connection with Executive’s
responsibilities as President, National Sales.



     2. Duties.



          (a) Executive shall report directly to the Company’s President and
Chief Operating Officer and shall perform his services within the
framework of the policies, objectives and Bylaws of the company.
Executive’s base of operation shall be at the company’s corporate
headquarters in Reston, Virginia. In his corporate capacity, Executive
(i) shall exercise general supervisory responsibility and management
authority over the Company’s national sales organization, and (ii)
shall perform such other duties commensurate with his position as may
be assigned to him from time to time by the Company’s President and
Chief Operating Officer or board of directors (the “Board of
Directors”)



          (b) Executive shall devote substantially all his business time,
attention and energies to the performance of his duties and functions
under this Employment Agreement and shall not during the term of his
employment hereunder be engaged in any other substantial business
activity for gain, profit or other pecuniary advantage, Executive shall
faithfully, loyally and diligently perform his assigned
duties and functions and shall not engage in any activities
whatsoever which conflict with his obligations to Employer during the
term of his employment hereunder.



     3. Term.
The term of this Employment Agreement shall commence on the
commencement Date and, unless terminated earlier pursuant to paragraph
10 hereof, shall continue through November 20, 2004 (the “Initial
Term”), and unless notice is given by either party at least sixty (60)
days prior to the end of the Initial Term that it desires that this
Employment Agreement terminate at the end of the Initial Term, shall
continue thereafter until such time as (i) either party hereto notifies
the other, upon sixty (60) days prior written notice, that this
Employment Agreement will be terminated, or



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(ii) Executives employment is otherwise terminated pursuant to
paragraph 10 hereof (the “Extended Term”) (the Initial Term together
with the Extended Term, if any, being referred to herein as the
“Employment Term”).




     4. Compensation. Employer shall pay to Executive, in consideration
of and as compensation for the services agreed to be rendered by
Executive hereunder, the following:



          (a) Base Salary. During the Employment Term, the Company shall pay
to Executive a Base Salary of $250,000 per annum; provided that the
amount of such Base Salary shall be reviewed at least annually and may,
in Employer’s sole discretion, be increased by Employer from time to
time during the Employment Term in light of the conditions then
existing and the services then being rendered by Executive, in which
case Executive’s Base Salary shall be such higher amount as may be
determined by Employer (such annual Base Salary, as in effect from time
to time, being referred to herein as the “Base Salary”). The Base
Salary shall be payable in accordance with Employer’s normal payroll
schedule, less appropriate deductions for federal, state and local
income taxes, PICA contributions and any other deductions required by
law or authorized by Executive.



          (b) Annual Performance Bonus. In addition to the Base Salary,
Executive shall be entitled to receive an annual performance bonus (the
“Annual Bonus”) during each year of service during the Employment Term
(each such year being referred to as an “Annual Bonus Period”), in an
amount, if any, as may be determined by the compensation committee of
the Board of Directors (the “Compensation Committee”) and/or the Board
of Directors in their complete discretion, with a target of 55% of the
Base Salary payable during such Annual Bonus Period, based on
Executive’s performance against objectives for the prior year of
service, provided that Executive’s eligibility to receive the Annual
Bonus shall be subject to and conditioned upon Executive continuing to
be employed by Employer on the date of payment of the Annual Bonus.
Each Annual Bonus shall be payable in accordance with Employer’s normal
annual bonus payment schedule, less appropriate deductions for federal,
state, and local income taxes, FICA contributions and any other
deductions required by law or authorized by Executive. Executive
acknowledges and agrees that, unless notified by Employer to the
contrary, Employer shall replace
the Annual Bonus for 2002 and 2003 with a retention bonus plan in
connection with XO’s plan of reorganization in its Chapter 11
proceeding and its stand-alone plan of reorganization (the “Retention
Bonus Plan”) and in such event Executive shall be entitled to any
amounts due as specified and in accordance with the Retention Bonus
Plan in lieu of any right to the Annual Bonus for 2002 and 2003. Unless
notified by Employer to the contrary, the term Annual Bonus shall
globally be replaced with the term Retention Bonus (and the terms of
the Retention Bonus Plan shall govern such Bonus) and Executive agrees
that the replacement of the Annual Bonus for 2002 and 2003 with the
Retention Bonus as specified in this paragraph shall not constitute
Constructive Termination.



          (c) Equity Incentive Compensation. The Compensation Committee may,
in its discretion, grant to Executive, pursuant to any stock option plan
of the Company, options to acquire shares of the Company’s common stock
and/or awards of restricted stock of the Company (collectively, “Equity
Awards”). The terms and conditions of such Equity Awards shall be
pursuant to such applicable stock option plan and as determined by the
Company in its sole discretion.



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     5. Benefits. During the Employment Term, Executive shall be
entitled to participate in all group health, major medical, pension and
profit sharing, 401(k) and other benefit plans maintained by Employer
or its subsidiaries and provided generally to the Company’s executive
officers, on the same terms as apply to participation therein by
management generally (except as otherwise provided herein). Further,
during the Employment Term, Executive shall be entitled to participate
in all fringe benefit programs and shall receive all perquisites if and
to the extent that Employer establishes and makes such benefits and
perquisites available to management generally, including, but not
limited to, Employer-paid long-term disability insurance and life
insurance coverage.



     6. Expenses: Relocation.



          (a) Travel and Entertainment Expenses. During the Employment
Term, Employer shall reimburse Executive for all reasonable travel,
entertainment and other business expenses incurred or paid by Executive
in performing his duties and functions hereunder.



          (b) Relocation Expenses. Employer shall reimburse Executive for
relocation expenses incurred in connection with his relocation from the
San Francisco, California area to the Reston, Virginia area in
accordance with Employer’s relocation policy as it applies generally to
the Company’s executive officers (as amended or modified from time to
time, the “Relocation Policy”), subject to the additional terms and
conditions of this paragraph 6(b). Employer agrees and acknowledges
that Executive desires to delay his relocation temporarily, and
Executive agrees and acknowledges that (i) he must make use of any
relocation benefits to which he may be entitled pursuant to the
Relocation Policy or this Employment Agreement by July 31, 2003, and
(ii) he will forfeit all rights with respect to any such relocations
benefits,
including any right of expense reimbursement, if he fails to make
use of such relocation benefits by July 31, 2003; provided, however,
that Employer shall reimburse relocation expenses, so long as Executive
incurs a relocation related expense for which he is entitled to
reimbursement pursuant to the Relocation Policy or the terms of this
Employment Agreement prior to July 31, 2003 and applies for expense
reimbursement promptly thereafter, in accordance with Employer’s
policies and procedures with respect to expense reimbursement. Until
the earlier of August 31, 2003 or the date that Executive has
relocated to Reston, Virginia, Employer will reimburse Executive for
the cost of leasing a temporary studio-type apartment in the Reston,
Virginia area and travel to and from Executive’s residence in the San
Francisco area; provided, however, that (i) such reimbursement for the
apartment shall not exceed $2,500 per month, and (ii) one-half of the
aggregate amount of such lease expense reimbursed by Employer shall be
deducted from the amount of expense reimbursement to which Executive
would otherwise be entitled to under the Relocation Policy. If, within
one (1) year of the date that Executive commences his relocation,
Executive voluntarily terminates his employment, other than with
respect to a Constructive Termination (as defined below), or Employer
terminates Executive’s employment for Cause, Executive agrees to
reimburse Employer the full cost of all relocation expenses for which
Executive was reimbursed by Employer. By executing this Employment
Agreement, Executive consents to Employer deducting such relocation
costs subject to reimbursement from Executive’s final payment of Base
Salary or other compensation.



     7. Vacations. Executive shall be entitled to such vacations,
holidays, sick leave and personal time off as is allowed under the
policies of Employer to management generally (except as otherwise
provided herein).




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     8. Non-Competition; Non-Solicitation



          (a) During the Employment Term and (except as provided in
paragraph 10 herein) for a period of two years thereafter, Executive
shall not enter into or participate in any business competitive to the
business carried on by the Company or any of its subsidiaries.



          (b) During the Employment Term and (except as provided in
paragraph 10 herein) for a period of two years thereafter, Executive
shall not (i) directly or indirectly cause or attempt to cause any
employee of Employer or any of its affiliates to leave the employ of
Employer or any affiliate of Employer, (ii) in any way interfere with
the relationship between Employer and any employee or between an
affiliate of Employer and any employee of such an affiliate, or (iii)
interfere or attempt to interfere with any transaction in which the
Company or any of its affiliates was involved during the Employment
Tern,.



          
(c) The provisions of this paragraph B shall survive the
expiration and/or termination of this Employment Agreement.



     9. Confidential Information. During the Employment Term and for a
period of two years thereafter, Executive will not use for his own
advantage or disclose any proprietary or confidential information
relating to the business operations or properties of Employer, any
affiliate of Employer or any of their respective customers, suppliers,
landlords, licensors or licensees. Upon the expiration or termination
of the Employment Term, upon Employer’s request, Executive will
surrender and deliver to Employer all documents and information of
every kind relating to or connected with Employer and its affiliates
and their respective businesses, customers, suppliers, landlord,
licensors and licensees. The foregoing confidential information
provisions shall not apply to information which: (i) is or becomes
publicly known through no wrongful act of the Executive, (ii) is
rightfully received from any third party without restriction and
without breach by Executive of this Employment Agreement; or (iii) is
independently developed by Executive after the term of his employment
hereunder or is independently developed by a competitor of Employer at
any time. The provisions of this paragraph 9 shall survive the
expiration and/or termination of this Employment Agreement.



     
10. Termination.



          (a) Automatic Termination Upon Death. In the event of Executive’s
death during the Employment Term, Executive’s employment hereunder
shall he automatically terminated upon the date of death. As soon as
reasonably practicable following Executive’s death, Employer shall pay
to Executive’s Representative (defined below in paragraph 20) (i)
Executive’s accrued but unpaid Base Salary and Annual Bonus, through
the last day of the month of his death, and (ii) any amount due
hereunder for accrued but
unused vacation time as of the date of death.



          
(b) Termination by Employer. During the Initial Term, Employer
shall be entitled to terminate Executive’s employment hereunder only
upon the establishment of “Cause” or the “Permanent Disability” of
Executive (as those terms are defined below) by giving written notice
to that effect to Executive. During any Extended Term, Employer shall
he entitled to terminate Executive’s employment hereunder (i) upon the
establishment of Cause or the Permanent Disability of Executive, by
giving written notice to that effect to Executive or (ii) for any other
reason or for no reason upon 60 days prior written notice to Executive.



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For purposes hereof, the term “Cause” means either (1)
Executive’s failure to substantially perform his duties and functions
as contemplated hereunder, if such failure constitutes gross neglect or
willful malfeasance; (2) Executive’s committing fraud or embezzlement
or otherwise engaging in conduct that results in Executive being
convicted of a felony from which all appeals have been exhausted; (3)
Executive’s intentionally acting in a manner which is materially
detrimental or damaging to the Company’s reputation, business,
operations or relations with its employees, suppliers or customers,
without taking reasonable steps to remedy such actions promptly after
receiving written notice thereof from Employer; (4) Executive’s chronic
or habitual abuse of alcohol or prescription drugs or controlled
substances; or (5) Executive’s committing any other material breach of
this Employment Agreement without taking reasonable steps to cease or
remedy such breach within thirty (30) days after Executive’s receipt of
written notice from Employer specifically identifying the nature of and
circumstances relevant to any such claimed material breach by
Executive.



          For purposes hereof the term “Permanent Disability” means: (i)
Executive’s failure to devote full normal working time as required
herein to his employment hereunder for a period of at least 90
consecutive normal business days (or for at least a majority of the
normal business days in any consecutive 180-day period); and (ii) the
existence of an illness or incapacity (either physical or mental)
affecting Executive which, in the reasonable opinion of a Qualified
Physician, is likely to be of such character or severity that Executive
would be unable to resume devoting his full normal working time, as
required herein, to his employment hereunder for a period of at least
nine consecutive months; the term “Qualified Physician” means an
impartial physician competent to diagnose and treat the illness or
condition which Executive is believed to be suffering, selected by
Employer and reasonably acceptable to Executive (or if Executive is
then incapable of acting for himself, Executive’s Representative), who
shall have personally examined Executive and shall have personally
reviewed Executive’s relevant medical records; provided Employer shall
bear the costs of such Qualified Physician’s services and Executive
agrees to submit to an examination by such Qualified Physician
and to the disclosure of Executive’s relevant medical records to
such Qualified Physician.



          
The date upon which any termination effected pursuant to this
subparagraph 10(b) shall be effective is set forth in subparagraph
10(d) and the effect of any such termination shall be as described in
subparagraphs 10(e), (f) and (g).



          
(c) Termination by Executive. Executive shall be entitled to
terminate his employment hereunder (i) upon the establishment of
Constructive Termination, by giving notice to that effect to Employer
or (ii) for any other reason or for no reason upon sixty (60) days prior
written notice to Employer.



          For purposes hereof, “Constructive Termination” shall mean
Executive’s termination of his employment hereunder as a direct result
of (i) a reduction in Executive’s initial Base Salary or in the target
Annual Bonus percentage, (ii) a material change in the nature or
extent of Executive’s title or responsibilities that is inconsistent
with Executive’s intended position and status hereunder, (iii) the
relocation of Executive’s principal place of employment to a location
more than 50 miles from Executive’s current principal place of
employment or (iv) the material breach by the Employer of any provision
of this Employment Agreement which continues without reasonable steps
being taken to cure such breach for a period of 30 days after written
notice thereof by Executive to Employer.



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The date upon which any termination effected pursuant to this
subparagraph 10(c) shall be effective is set forth in subparagraph
10(d), and the effect of any such termination shall be as described in
subparagraph 10(g).



     
     
(d) Termination Date. In the event Executive’s employment hereunder
is terminated for circumstances constituting Cause, Permanent
Disability or Constructive Termination, such termination shall take
effect upon the termination date set forth in the written notice to
that effect given by Executive to Employer or by Employer to Executive,
as the case may be (provided that if either party disputes the
propriety of such termination, the effective date of termination shall
be as established, by final resolution of such dispute, whether by
agreement of the parties or award of an arbitrator as contemplated
herein, in favor of the propriety of such termination), and in any
other case termination of Executive’s employment hereunder shall take
effect on the date specified in the written notice thereof delivered by
Executive to Employer or by Employer to Executive, as the case may be
(the date on which any such termination takes effect being referred to
herein as the “Termination Date”). Employer, at its option, may require
Executive to continue to perform his duties hereunder until the
Termination Date or pay to Executive such amount of compensation and
benefits otherwise due hereunder in accordance with Employer’s then
existing salary payment schedule or in one lump sum payment
if appropriate.



          
(e) Effect of Termination by Employer For Cause. In the event
Executive’s employment is terminated by Employer for Cause, or in the
event Executive voluntarily terminates his employment as contemplated
by paragraph 10(c), at any time during the Employment Term, then
Employer shall pay to Executive his accrued but unpaid Base Salary and
Annual Bonus through the Termination Date.



          
(f) Effect of Termination Upon Permanent Disability. In the event
Executive’s employment is terminated by Employer upon the permanent
disability of Executive at any time during the Employment Term, then:




       
        
(i) Employer shall pay to Executive
(x) Executive’s accrued but
unpaid Base Salary and Annual Bonus through the Termination Date, (y)
Executive’s then existing Base Salary for 12 months from the date
written notice of the termination of Executive’s employment is given by
Employer, and (z) any amount due hereunder for accrued but unused
vacation time as of the Termination Date.




       
        (ii) Employer, at its expense, shall make all benefit payments, on
behalf of Executive and Executive’s dependents, for such benefits
Executive otherwise would have been entitled to receive hereunder, for
12 months following the date written notice of the termination of
Executive’s
employment is given by Employer.



          
(g) Effect of Wrongful or Constructive Termination. In the event
Executive’s employment is terminated during the Employment Term (x) by
Employer for any reason other than death, Permanent Disability or
Cause, or (y) by Executive in circumstances constituting Constructive
Termination, then, from and after such Termination Date:



               (i) Executive shall not be subject to the
non-competition
provisions set forth in paragraph 8 hereof.



               (ii) Executive shall he entitled to receive the Base Salary,
Annual Bonus, and benefits, which Executive reasonably would have
expected to receive in the period from the Termination Dale to the
expiration of the Initial Term (if such Termination Date occurs more
than six (6) months prior to the expiration of the




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Initial Term) or for a period of six (6) months following the
Termination Date (if such Termination Date occurs after the initial
Term or within the six-month period prior to the expiration of the
initial Term), all of which shall be paid upon the Termination Date.



     The foregoing shall be Executive’s sole and exclusive remedy for
any such termination of his employment under this subparagraph 10(g).



          (h) Miscellaneous. In the event of any termination or attempted
termination hereof: (i) if multiple events, occurrences or
circumstances are asserted as bases for such termination or attempted
termination, the event, occurrence or circumstance that is earliest in
time, and any termination or attempted termination found to be proper
hereunder based thereon, shall take precedence over the others; (ii) no
termination of this Employment Agreement shall relieve or release
either party from liability hereunder based on any breach of the terms
hereof by such party occurring prior to the Termination Date; and (iii)
the terms of this Employment Agreement relevant to performance or
satisfaction of any obligation hereunder expressly remaining to be
performed or satisfied in whole or in part at the Termination Date
shall continue in force until such full performance or satisfaction has
been accomplished and otherwise neither party hereto shall have any
other or further remaining obligations to other party hereunder.



          (i) No
Set-off; No Duty of Mitigation. Subject to paragraph 6(h),
there shall be no right of setoff or counterclaim, in respect of any
actual or alleged claim, debt or obligation, against any payments or
benefits required to be made or provided to Executive hereunder
(including, without limitation, pursuant to subparagraphs
10(f) and (g) above). In the event of any termination of Executive’s employment under
this paragraph 10, Executive shall be under no obligation to seek
other employment and shall be entitled to all payments or benefits
required to be made or provided to Executive hereunder, without any
duty of mitigation of damages and regardless of any other employment
obtained by Executive.



     11. Injunctive
Relief. It is agreed that the services of Executive
are unique and that any breach or threatened breach by Executive of any
provision of this Employment Agreement cannot be remedied solely by
damages, Accordingly, in the event of a breach by Executive of his
obligations under this Employment Agreement, Employer shall be entitled
to seek and obtain interim restraints and permanent injunctive relief
without proving the inadequacy of damages as a remedy, restraining
Executive and any business, firm, partnership, individual, corporation
or entity participating in such breach or attempted breach. Nothing
herein, however, shall be construed as prohibiting Employer from
pursuing any other remedies available at law or in equity for such
breach or threatened breach, including the recovery of damages and the
termination of the services of Executive.



     12. Arbitration. Any dispute or controversy arising out of or
relating to this Employment Agreement or any claimed breach hereof shall
be settled, at the request of either party, by an arbitration proceeding
conducted in accordance with the rules of the American Arbitration
Association (“AAA”), with the award determined to be appropriate by the
arbitrator therein to be final, non-appealable and binding on the
parties hereto, and with judgement upon such award as is rendered in any
such arbitration proceeding available for entry and enforcement in any
court having jurisdiction of the parties hereto. The arbitrator shall be
an impartial arbitrator qualified to serve in accordance with the rules
of the AAA and shall be reasonably acceptable to each of the Employer
and the Executive. If no such acceptable arbitrator is so appointed
within 15 days after the initial



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  request for arbitration of such disputed
    matter, each of the parties promptly shall designate a person qualified to
    serve as an arbitrator in accordance with the rules of the AAA, and the two
    persons so designated promptly shall select the arbitrator from among those
    persons qualified to serve in accordance with the rules of the AAA. The arbitration
    shall be held in the greater Northern Virginia area, or in such other place
    as may be agreed upon at the time by the parties. The expenses of the arbitration
    proceeding shall be borne by Employer, but the arbitrator’s award may
    provide that Executive shall reimburse Employer for an equitable share of
    such expenses if Executive is not the prevailing party on any of the issues
    involved in such arbitration. Employer shall pay for and bear the cost of
    its own and Executive’s experts, evidence and counsel in such arbitration
    proceeding, but the arbitrator’s award may provide that, in addition
    to any other amounts or relief due to Employer, Executive shall reimburse
    Employer on demand for all of such costs of Executive’s experts, evidence
    and counsel initially incurred by Employer, to the extent the award finds
    such costs properly allocable to any issue(s) in dispute as to which the award
    indicates the Employer to be the prevailing party.
  
     13. Indemnification.


  
          (a) The
    Company (the “Indemnifying Party”) shall indemnify Executive to
    the fullest extent permitted by Delaware law as in effect on the date hereof
    against all costs, expenses, liabilities and losses (including, without limitation,
    attorneys’ fees, judgments, penalties and amounts paid in settlement)
    reasonably incurred by Executive in connection with any action suit or proceeding,
    whether civil, criminal, administrative or investigative in which Executive
    is made, or is threatened to be made, a party to or a witness in such action,
    suit or proceeding by reason of the fact that he is or was an officer, director,
    consultant, agent or Executive of the Company or of any of its controlled
    affiliates or is or was serving as an officer, consultant director, member,
    Executive, trustee, agent or fiduciary of any other entity at the request
    of the Company (a “Proceeding”)

  
          (b) The Indemnifying Party shall advance to Executive all
reasonable costs and expenses incurred by him in connection with a
Proceeding within 20 days after receipt by the Indemnifying Party of a
written request for such advance, accompanied by an itemized list of
the costs and expenses and Executive’s written undertaking to repay to
the Indemnifying Party on demand the amount of such advance if it shall
ultimately be determined that Executive is not entitled to be
indemnified against such costs and expenses.


  
          (c) The
    indemnification provided to Executive hereunder is in addition to, and not
    in lieu of, any additional indemnification to which he may be entitled pursuant
    to the Certificate of Incorporation or Bylaws of the Indemnifying Party, any
    insurance maintained by the Company from time to time providing coverage to
    Executive and ether officers and directors of the Company, or any separate
    written agreement between Executive and the Company or one of its controlled
    affiliates. The provisions of this paragraph 13 shall survive any termination
    of this Employment Agreement.
  
     14. Amendment
    and Modification. This Employment Agreement contains the entire agreement
    between the parties with respect to the subject matter hereof, and supersedes
    any and all prior agreements, arrangements or understandings between the parties
    hereto with respect to the subject matter hereof whether written or oral.
    Subject to applicable law, this Employment Agreement may be amended, modified
    and
  
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supplemented by written agreement of Employer and Executive with
respect to any of the terms contained herein.



  
     15. Waiver
    of Compliance. Any failure of either party to comply with any obligation,
    covenant, agreement or condition on its part contained herein may be expressly
    waived in writing by the other party, but such waiver or failure to insist
    upon strict compliance shall not operate as a waiver of, or estoppel with
    respect to any subsequent or other failure. Whenever this Employment Agreement
    requires or permits consent by or on behalf of any party, such consent shall
    be given in writing.
  
     16. Notices.
    All notices, requests, demands and other communications required or permitted
    hereunder shall be in writing and shall be deemed to have been duly given
    if delivered by hand, sent by registered or certified U.S. Mail, postage prepaid,
    commercial overnight courier service or transmitted by facsimile and shall
    be deemed served or delivered to the addressee at the address for such notice
    specified below when hand delivered, upon confirmation of sending when sent
    by fax, on the day after being sent when sent by overnight delivery or five
    (5) days after having been mailed, certified or registered, with postage
    prepaid:

  

	 	 	 
	If to Emoloyer:

	 	If to Executive:
	XO Communications, Inc.

	 	John H. Jacquay
	11111 Sunset Hills Road

	 	At such address as shall be reflected
	Reston, VA 20190

	 	in Employer’s payroll records
	Facsimile: 703-547-2025
	 	 
	Attention: General Counsel
	 	 






  or, in the case of either such party,
    to such substitute address as such party may designate from time to time for
    purposes of notices to be given to such party hereunder which substitute address
    shall be designated as such in a written notice given to the other party addressed
    as aforesaide.
  
     17. Assignment.
    This Employment Agreement shall inure to the benefit of Executive and Employer
    and be binding upon the successors and general assigns of Employer. This Employment
    Agreement shall not be assignable, except to the extent set forth in paragraph
    20.
  
     18. Enforceability.
    In the event it is determined that this Employment Agreement is unenforceable
    in any respect, it is the mutual intent of the parties that it be construed
    to apply and be enforceable to the maximum extent permitted by applicable
    law.
  
     19. Applicable
    Law. This Employment Agreement shall be construed and enforced in accordance
    with the laws applicable to contracts executed, delivered and fully to be
    performed in the State of Virginia.
  
     20. Beneficiaries:
    Executive’s Representative. Executive shall be entitled to select (and
    to change, from time to time, except to the extent prohibited under any applicable
    law) a beneficiary or beneficiaries to receive any payments, distributions
    or benefits to be made or distributed hereunder upon or following Executive’s
    death. Any such designation shall be made by written notice to Employer. In
    the event of Executive’s death or of a judicial determination of Executive’s
    incompetence, references in this Agreement to Executive shall be deemed, as
    appropriate, to refer to his designated beneficiary, to his estate or to his
    executor or personal representative (“Executives Representative”)
    solely for the purpose of providing a clear mechanism for
  
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the exercise of Executive’s rights hereunder in the Case of
Executive’s death Or Permanent Disability.





     21. Bankruptcy
    Court Approval. Although the Company believes it may enter into this Employment
    agreement in the ordinary course of its Business, out of an abundance of caution,
    the Company shall seek Bankruptcy Court approval hereof.
  
     IN WITNESS WHEREOF, the parties have executed this Employment
Agreement to be effective on and as of the day and year first above
written.



XO COMMUNICATIONS, INC.



By: /s/ DANIEL F. AKERSON

    Name:Daniel F. Akerson

Title: Chairman and Chief Executive Officer

  



/s/ JOHN
H. JACQUAY          

John H. Jacquay



 

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