It is turbulent times at Clearwire, the Bellevue wireless broadband company that’s now become a critical pawn (largely due to its spectrum holdings) in the wireless industry.
But CEO Erik Prusch is doing his best to keep staffers focused, even with the media reports circling. In a memo to staff titled “Transaction Update,” Prusch reassures staff that there are no layoffs planned at this time and that “Clearwire remains a separate company and it is business as usual for all of us.”
Of course, calling it business as usual is a bit of a stretch. Clearwire is now currently weighing two bids — one from Sprint $2.97 per share and another from Dish Network at $3.30 per share.
It’s a good-old-fashioned bidding war. And staffers are along for the ride, watching today as Clearwire’s stock surges more than seven percent to $3.14 on the Dish Networks’ news.
Clearwire employed 1,053 people at the end of September, including about 400 in the Seattle area. Here’s the full memo that Prusch sent to staff:
From: Erik Prusch
To: Clearwire Employees
Subject: Transaction Update
Distribution: 1/8/13 immediately following the Doberman press release
I hope you enjoyed a restful holiday and happy New Year. I’m sure you’ve all now had time to ponder the pending transaction with Sprint, and I’d like to address a few key questions.
Regarding the pending Sprint transaction, there has been some media speculation regarding layoffs and I want to let you know that there are no planned reductions to our workforce at this time that are due to the pending transaction. We have a smart, skilled team that is needed to operate our business and continue the important work of building our LTE network. If the Sprint transaction with Clearwire is approved by shareholders and regulators, we expect it would be finalized in the second or third quarter of 2013. Until then, Clearwire remains a separate company and it is business as usual for all of us.
Many of you have Restricted Stock Units (RSUs) as part of your compensation package and have asked about the impact on them if we merge with Sprint. We are pleased to be able to offer an accelerated vesting schedule – this is not always standard in merger agreements and we worked hard to make sure this was included. If the sale to Sprint closes, each unvested RSU held by Clearwire employees granted prior to December 17, 2012, would be settled for $2.97 in cash. Within 10 days of the closing of the Sprint acquisition 50% of these RSUs would be paid out to employees and the remaining 50% would be held in a Restricted Cash Account. The remaining 50% would pay out on the earlier of (1) the original vesting schedule of the RSUs or (2) the one year anniversary of the closing. If an employee is terminated prior to the one year anniversary, they would receive any remaining amounts from the Restricted Cash Account upon termination, provided they were not involuntarily terminated for cause or they did not terminate voluntarily without good reason. RSU payments would be taxed as compensation under federal and state laws.
Even though the pending Sprint transaction is in place, our Compensation Committee has the ability to continue granting new RSUs as part of the merit process in 2013. These new RSUs will be treated differently than the RSUs granted prior to December 17, 2012. If the sale to Sprint closes, each 2013 RSU would be settled for $2.97 in cash, which would be held in a Restricted Cash Account payable over the original vesting period determined by the Clearwire Compensation Committee when granted. As an added benefit, employees terminated without cause would be entitled to be paid out pro-rated for the time the employee worked during the vesting period.
Lastly, you can expect to receive 2013 retention information from your managers as part of our current performance review process. If you have any questions about the review process or the items discussed above, please reach out to your manager or send an email to Human Resources Communications.
I’d also like to let you know that we have received an unsolicited, non-binding proposal from DISH Network Corporation. You can read more about this in the press release we issued today: http://www.clearwire.com/newsroom.
Please know that while it is our goal to communicate as much as possible with you about both the DISH proposal and pending transaction with Sprint, we must also adhere to strict legal and regulatory requirements around communications. We will outline our specific 2013 goals and objectives with you in the coming weeks. In the meantime, let’s remain focused on furthering our LTE build and continuing to provide the high level of service our Wholesale and Retail customers have come to expect.