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EXHIBIT 10.14
SEPARATION AGREEMENT AND GENERAL RELEASE
This Separation Agreement and General Release (hereinafter, the
"Agreement") is made and entered into this 19th day of November, 1999, by and
between Xxxxxxxx Xxxxxxxxx (hereinafter, "Xx. Xxxxxxxxx") and Interland, Inc.,
a Georgia corporation headquartered in Atlanta, Georgia (hereinafter,
"Interland") (hereinafter, together, "the parties").
WHEREAS, the parties desire to enter into a written agreement
embodying their mutual understanding and promises reflecting their desire to
resolve any and all disputes, claims, and differences between the parties that
either of them may have arising from Xx. Xxxxxxxxx'x employment with Interland
and the termination thereof or for any other reason.
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, Xx. Xxxxxxxxx and Interland agree as follows:
1. Upon the expiration of the revocation period described in
paragraph 18 below Interland shall pay to Xx. Xxxxxxxxx (or his designee) the
sum of $330,000 and upon each of the first two anniversaries of the execution
of this Agreement, Interland shall pay to Xx. Xxxxxxxxx (or his designee or
estate) the sum of $165,000. Xx. Xxxxxxxxx agrees that no representations have
been made to him regarding the tax treatment of these payments, that he has
relied on his own tax advisor regarding this subject, and that if the Internal
Revenue Service or a State taxing authority determines that any taxes are due
or outstanding on these payments, he shall indemnify and hold harmless
Interland from any claim for taxes, interest or penalties.
2. Xx. Xxxxxxxxx agrees that as of the execution of this
Agreement, he resigns as both Chairman of the Board of Directors and as a
member of the Board of Directors of Interland and effectively ends any
employment, consulting, or other agency relationship of any kind whatsoever
with Interland. Xx. Xxxxxxxxx acknowledges and agrees that as of the time he
executes this Agreement he will have no authority to act for or on behalf of
Interland in any capacity.
3. Except as may otherwise be limited in writing in an agreement
executed by Xx. Xxxxxxxxx in connection with Interland's offering of Series A
Convertible Participating Preferred Stock, Xx. Xxxxxxxxx has the right, at
will, to transfer any or all of his shares of Interland at anytime and
Interland, at its expense, will cause the issuance of such legal opinions and
transfer agent services to effect such transfer, provided that such transfer(s)
requested by Xx. Xxxxxxxxx are in compliance with all applicable state and
federal securities laws.
4. (a) Xx. Xxxxxxxxx, on his behalf and on behalf of his
heirs, successors, agents, executors, administrators, attorneys and assigns,
hereby releases and forever discharges Interland and any and all of its current
or former affiliated entities, benefit plans, departments, stockholders,
officers, directors, employees, representatives, agents, attorneys, affiliates,
successors and assigns (hereinafter referred to as the "Released Parties"), to
the fullest extent provided by law, from any and all charges, complaints,
claims, liabilities, obligations, promises, agreements, controversies, damages,
actions, causes of action, suits, rights, demands, costs, losses, debts and
expenses (including attorneys' fees and costs actually incurred), of any nature
whatsoever, known or unknown, suspected or unsuspected, which he now has, owns,
or holds, or claims to have, own, or hold, which he at any time heretofore had,
owned, or held, or claimed to have had, owned, or held, and which he at any
time in the future may have, own, or hold, against any one or more of them, for
any reason or cause whatsoever arising on or prior to the date hereof, whether
in law or in equity, under federal, state or other local law, including without
limitation any and all claims arising from or relating to Xx. Xxxxxxxxx'x
employment with Interland or the Released Parties or the termination thereof,
any claims relating to or arising under any employment contract, any employment
statute or regulation,
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any employment discrimination law, including but not limited to the Age
Discrimination in Employment Act, as amended, 29 U.S.C. ss. 621 et seq., Title
VII of the Civil Rights Act of 1964, as amended, the Equal Pay Act of 1963, and
any other federal, state, or local civil rights, pension or labor law, contract
law, tort law, or common law. Xx. Xxxxxxxxx warrants that this is a general
release and that he has not assigned or transferred any claims covered hereby.
Provided, however, that notwithstanding anything to the contrary herein, this
Release shall not release any rights under this Agreement, under any rights to
indemnification arising as a result of service as a director, officer or
employee of Interland, rights arising solely as a result of Xx. Xxxxxxxxx'x
status as a shareholder of Interland or rights arising as an option holder
pursuant an agreement existing on the date hereof.
(b) Interland, on its behalf and on behalf of its agents,
executors, administrators, attorneys and assigns, hereby releases and forever
discharges Xx. Xxxxxxxxx to the fullest extent provided by law, from any and
all charges, complaints, claims, liabilities, obligations, promises,
agreements, controversies, damages, actions, causes of action, suits, rights,
demands, costs, losses, debts and expenses (including attorneys' fees and costs
actually incurred), of any nature whatsoever, known or unknown, suspected or
unsuspected, which it now has, owns, or holds, or claims to have, own, or hold,
which it at any time heretofore had, owned, or held, or claimed to have had,
owned, or held, and which it at any time in the future may have, own, or hold,
against him, for any reason or cause whatsoever arising on or prior to the date
hereof, whether in law or in equity, under federal, state or other local law,
including without limitation any and all claims arising from or relating to Xx.
Xxxxxxxxx'x employment by or association with Interland or the termination
thereof, any claims relating to or arising under any employment contract, any
employment statute or regulation, any employment discrimination law, including
but not limited to the Age Discrimination in Employment Act, as amended, 29
U.S.C. ss. 621 et seq., Title VII of the Civil Rights Act of 1964, as amended,
the Equal Pay Act of 1963, and any other federal, state, or local civil rights,
pension or labor law, contract law, tort law, or common law. Interland warrants
that this is a general release and that it has not assigned or transferred any
claims covered hereby.
5. (a) Without limiting the generality of the general
release in Paragraph 4(a), Xx. Xxxxxxxxx, on his behalf and on behalf of his
heirs, legal representatives and assigns, further agrees not to xxx or
otherwise institute or cause to be instituted, or solicit, encourage, or cause
any other individual or entity to xxx or otherwise institute or cause to be
instituted, except as required by order of a court or of any agency of the
federal, state, or local government, the prosecution of any claim, complaint,
or charge against any entity released herein in any federal, state, local or
other court, administrative agency, commission, or other forum seeking damages
concerning any claims released herein, and Xx. Xxxxxxxxx irrevocably and
unconditionally waives any and all rights to recover any relief and damages
concerning claims released herein. Xx. Xxxxxxxxx specifically represents that
no complaints, charges, or other proceedings are pending in any court,
administrative agency, or other forum relating directly or indirectly to any
claims released herein.
(b) Without limiting the generality of the general
release in Paragraph 4(b), Interland, on its behalf and on behalf of its agents
and assigns, further agrees not to xxx or otherwise institute or cause to be
instituted, or solicit, encourage, or cause any other individual or entity to
xxx or otherwise institute or cause to be instituted, except as required by
order of a court or of any agency of the federal, state, or local government,
the prosecution of any claim, complaint, or charge against any person or entity
released herein in any federal, state, local or other court, administrative
agency, commission, or other forum seeking damages concerning any claims
released herein, and Interland irrevocably and unconditionally waives any and
all rights to recover any relief and damages concerning claims released herein.
Interland specifically represents that no complaints, charges, or other
proceedings are pending in any court, administrative agency, or other forum
relating directly or indirectly to any claims released herein.
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6. Xx. Xxxxxxxxx agrees that he will strictly maintain the
confidentiality of the existence and terms of this Agreement, except that he
may disclose the terms of this Agreement if required by order of a court of
competent jurisdiction, or as agreed to in writing by the parties. In addition,
Xx. Xxxxxxxxx may disclose the existence and terms of this Agreement to his
tax, accounting and legal advisors, provided that he instructs them that the
settlement of this matter is confidential and that any disclosure by them to a
third person would be improper and could constitute a breach of this Agreement.
7. Xx. Xxxxxxxxx shall be entitled to advancement of expenses as
contemplated by ss.14-2-853 of the Official Code of Georgia Annotated, or any
successor provision thereto, provided that the written affirmations and written
undertakings enumerated therein are provided to Interland.
8. Xx. Xxxxxxxxx shall maintain Confidential Information (as
defined below) as secret and confidential unless he is required to disclose
Confidential Information pursuant to the terms of a valid and effective order
issued by a court of competent jurisdiction or a governmental authority. All
physical items, including electronic media, containing Confidential
Information, including, without limitation, any business plan, know-how,
collection methods and procedures, advertising techniques, marketing plans and
methods, sales techniques, documentation, contracts, reports, letters, notes,
any computer media, client lists, and all other information and materials of
Interland's business and operations, shall remain the exclusive and
confidential property of Interland and shall be returned, along with any copies
or notes Xx. Xxxxxxxxx made thereof or therefrom, to Interland promptly upon
execution of this Agreement. For the purposes of this Agreement, "Confidential
Information" shall mean information, without regard to form, related to
Interland's business. Such information shall include, but shall not be limited
to: (1) any financial, business, planning, operations, services, potential
services, products, potential products, technical information, intellectual
property, trade secrets, know-how, and/or formulas, as well as production,
purchasing, marketing, sales, personnel, customer, supplier, or other
information of Interland; (2) any papers, data, records, processes, methods,
techniques, systems, models, samples, devices, equipment, compilations,
invoices, customer lists, or documents of Interland; (3) any confidential
information or trade secrets of any third party provided to Interland in
confidence or subject to other use or disclosure, restrictions, or limitations;
and (4) any other information, written, oral or electronic, which pertains to
Interland's affairs or interests or with whom or how Interland does business,
whether existing now or at some time in the future, whether pertaining to
current or future developments, and whether accessed during, prior to, or after
Xxxxxxxxx'x tenure or association with Interland. Interland acknowledges and
agrees that Confidential Information shall not include information in the
public domain or information that was or becomes available from a source that
Xx. Xxxxxxxxx reasonably believes was not and is not legally bound to Interland
to maintain the confidentiality of the information.
9. (a) Interland agrees to provide Xx. Xxxxxxxxx any and
all written information and reports that it provides to the holders of
Interland's Series A Convertible Participating Preferred Stock or if the
issuance of such Preferred Stock does not occur, then Xx. Xxxxxxxxx shall be
entitled to such information and reports as he reasonably may request.
(b) Xx. Xxxxxxxxx shall be permitted to participate on
an equal basis with Xx. Xxxxxxxxxx in the allocation of any "friends and
family" shares in connection with the initial public offering of Interland's
common stock.
(c) Xx. Xxxxxxxxx shall be entitled to all stock
registration rights that are granted by Interland to Xx. Xxxxxxxxxx, on an
equal basis with Xx. Xxxxxxxxxx in proportion to their relative ownership of
Interland's equity securities. Xx. Xxxxxxxxx will be entitled to piggyback
registration rights after Interland's initial public offering on terms and
conditions that are customary in comparable situations, which rights will be
memorialized in a separate agreement.
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(d) Interland hereby agrees to take any and all actions
as are necessary or required to amend Xx. Xxxxxxxxx'x current options to
acquire Interland's common stock so that such options will not expire as a
result of Xxxxxxxxx'x termination pursuant hereto and will become fully
exercisable upon the earlier to occur of July 1, 2001 or the completion of
Interland's initial public offering and may be exercised by Xx. Xxxxxxxxx(or
his personal representative or executor in the event of his death or
disability) until the earlier of the third anniversary of the IPO or July 1,
2004.
(e) Interland agrees that Xx. Xxxxxxxxx'x loan from
Interland in the principal amount of $200,000, which is the entire amount owed
by Xx. Xxxxxxxxx to the Company) shall be accorded equal treatment as is given
to the similar existing loan extended by Interland to Xx. Xxxxxxxxxx; and
provided further that notwithstanding any provision in the loan documentation
to the contrary, that the loan will not be due until the earlier to occur of a
six month period after Interland's initial public offering or 5 years from the
date of this agreement.
10. Xx. Xxxxxxxxx shall not at any time make false, misleading or
disparaging statements, or statements that could be interpreted as such, about
Interland, including its products, services, management, employees and
customers. Interland shall not make any false, misleading or disparaging
statements or statements that could be interpreted as such concerning Xx.
Xxxxxxxxx.
11. Xx. Xxxxxxxxx hereby covenants and agrees that for a period
of one year immediately following the date hereof he shall not act in any way,
directly or indirectly, with the purpose or effect of soliciting, diverting or
taking away any strategic partner, business, customer, client or supplier of
Interland that he contacted, directly or indirectly, or that anyone directly or
indirectly supervised by him contacted, directly or indirectly, during his
employment by the Interland.
12. Xx. Xxxxxxxxx hereby covenants and agrees that for a period
of one year immediately following the date hereof he shall not act in any way
with the purpose or effect of soliciting, recruiting, or encouraging, directly
or indirectly, any Person who is or was at any time during the one year period
prior to the termination of his employment with Interland to leave the employ
of Interland, its divisions or its subsidiaries.
13. Xx. Xxxxxxxxx hereby covenants and agrees that for a period
of six months immediately following the date hereof he shall not within the
United States and Europe (i) develop, own, manage, operate, or otherwise engage
in, participate in, represent, or in any way be connected with, as officer,
director, partner, owner, employee, agent, independent contractor, consultant,
proprietor, stockholder (except for the ownership of a less than 5% stock
interest in a publicly traded company), or otherwise, any business or activity
that competes with Interland or its affiliates; or (ii) otherwise compete with
Interland in the sale, marketing, provision, or licensing, directly or
indirectly, as officer, director, partner, owner, employee, agent, independent
contractor, consultant, proprietor, stockholder (except for the ownership of a
less than 5% stock interest in a publicly traded company), or otherwise, of any
products competitive with the products, or services competitive with the
services, developed or marketed by Interland within the United States or
Europe. Xx. Xxxxxxxxx acknowledges that (i) this covenant has unique,
substantial, and immeasurable value to Interland, (ii) this covenant is
reasonably limited in scope and geography to protect Interland's legitimate
business interests, including its property, confidential information and
relationships, good will, economic advantage, and customer relationships; (iii)
the agreements, covenants and undertakings of Xx. Xxxxxxxxx set forth in this
Agreement will not preclude him from becoming gainfully employed following
termination of the engagement with Interland; and (iv) the services Xx.
Xxxxxxxxx intends and is expected to provide are special and unique.
14. Because any breach or threatened breach of this Agreement by
Xx. Xxxxxxxxx would result in continuing material and irreparable harm to
Interland, and because it would be difficult or impossible to establish the
full monetary value of such damage, Interland shall be entitled to
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injunctive relief in the event of Xx. Xxxxxxxxx'x breach or threatened breach
of this Agreement. Injunctive relief is in addition to any other remedy that
may be available to Interland. In the event of any breach or threatened breach
by Xx. Xxxxxxxxx, Xx. Xxxxxxxxx shall reimburse Interland for its reasonable
attorneys' fees and other expenses Interland incurs.
15. The rights and restrictions in this Agreement may be
exercised and are applicable only to the extent that they do not violate
applicable laws, and are intended to be limited to the extent necessary so that
they will not render this Agreement illegal, invalid or unenforceable. If any
term shall be held illegal, invalid or unenforceable by a court of competent
jurisdiction, the remaining terms shall remain in full force and effect.
16. This Agreement may be amended, modified, or supplemented only
by a written instrument executed by the parties affected thereby, and shall be
binding upon their respective heirs, beneficiaries, and successors and assigns.
This Agreement is entered into in the State of Georgia and shall be governed by
and construed under Georgia law, exclusive of any choice of law rules.
17. This Agreement sets forth the entire agreement and
understanding between the parties on the subject matter hereof and merges all
prior discussions and negotiations between them. The parties each represent
that they are not relying on any promises or oral or written statements or
representations other than those in this Agreement.
18. Xx. Xxxxxxxxx acknowledges that he has read and understands
this Agreement and executes it knowingly, voluntarily and without coercion. Xx.
Xxxxxxxxx further acknowledges that he is being advised herein in writing to
consult with an attorney prior to executing this Agreement, and that he has
been given a period of at least twenty-one (21) days within which to consider
and execute this Agreement, unless he voluntarily chooses to execute this
Agreement before the end of the twenty-one (21) day period by executing the
attached Election to Execute Prior to Expiration of
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Twenty-One Day Consideration Period. Xx. Xxxxxxxxx understands that he has
seven (7) days following his execution of this Agreement to revoke it. For such
revocation to be effective, written notice of revocation must be delivered to
Xxxxx Xxxxxxxx, Xxxxxxxxxx Xxxxxxxx LLP, 0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxx 00000, no later than 5:00 p.m. on the seventh calendar day
after Xx. Xxxxxxxxx signs this Agreement. If Xx. Xxxxxxxxx revokes this
Agreement, it shall not be effective or enforceable and he shall not receive
the benefits described herein.
IN WITNESS THEREOF, Xx. Xxxxxxxxx and Interland, after carefully
reading the provisions of this Release herein declare that they understand such
provisions and willingly accept and agree thereto by executing this Agreement
this 19th day of November, 1999.
INTERLAND, INC.
/s/ Xxxxxxxx Xxxxxxxxx By: /s/ Xxxx Xxxx
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Xxxxxxxx Xxxxxxxxx
Title: Managing Director
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Date: November 19, 1999 Date: November 19, 1999
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ELECTION TO EXECUTE PRIOR TO EXPIRATION
OF TWENTY-ONE DAY CONSIDERATION PERIOD
I, Xxxxxxxx Xxxxxxxxx, understand that I have at least twenty-one (21)
days within which to consider and execute the foregoing Separation Agreement
and General Release. However, after having an opportunity to consult counsel I
have freely and voluntarily elected to execute the Separation Agreement and
General Release before the twenty-one (21) day period has expired.
/s/ Xxxxxxxx Xxxxxxxxx
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Xxxxxxxx Xxxxxxxxx
Date: November 19, 1999
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