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EXHIBIT 10.35
July 26, 0000
Xxxx Xxxxxxx
0 Xxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Dear Xxxx:
Further to our recent conversations, on behalf of Net2000 Communications, Inc.
(the "Company"), this letter (this "Agreement") sets forth certain terms and
conditions of your employment as Vice President Carrier Sales and Alternate
Channels, on or about August 14, 2000.
In consideration of the foregoing and your employment with the Company, and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, you and the Company agree as follows:
1. As Vice President Carrier Sales and Alternate Channels, located
in the New York area, you will report directly to, and be subject to the
direction of the President of the Company and will be fully responsible
and accountable for:
- Revenue and P&L for Carrier and Channel Sales. All General
Managers/Directors in these disciplines will report to you.
- Integral role in company decision making, market planning and
strategy development as a member of the senior executive
management team.
- Develop and drive the organizational skills, personnel
development, account strategies, territory planning and
administrative responsibilities to ensure a high level of
customer satisfaction is maintained. Develop and increase sales
revenue to ensure assigned targets are met or exceeded.
- Become actively involved in sales training programs. Aid as a
resource to Account Managers in contract opportunities,
proposals and proformas. Assists managers with contract
negotiations, closing the sale and developing marketing plans
for contract accounts.
- Assist with the planning of sales exhibits. Attend trade show.
Participate in education and training conferences on selling and
marketing programs. Coordinate and assist in leading sales
meetings to include site selection and agenda preparation.
- Keep informed of new products, services and other general
information of interest to customers. Check on competitive
activities and develop new methods of attaining resellers and
assisting managers in attaining new accounts.
Please bear in mind that Net2000 is an emerging and developing company.
Consequently, your duties and responsibilities may change based upon the
requirements of the business but will remain consistent with the
responsibilities of a Vice President.
2. Your employment by the Company is employment "at will" for an
indefinite term, and may be terminated at your option or the option of
the Company at any time with or without Cause (as defined below).
3. Your compensation by the Company will be as follows:
- Base salary at the annual rate of $160,000. Your base
salary shall be evaluated annually by the Company with
consideration given to a salary increase.
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July 26, 2000
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- The Company's bonus package for this position comprises
fifty percent (50%) of base salary at target (75%
including accelerator). Performance will be evaluated on
a calendar year basis and a bonus, if any is earned,
will be paid by April 15 of the following year. For
2000, your bonus will be prorated accordingly. The bonus
components are as follows:
a) Common Sr Team Objectives (25% of base)
- $60M in Revenue 6.25%
- Expense Control 6.25% (less than or
equal to 5% budget)
- Customer Retention 6.25%
(annual churn rate less than or
equal to 10% infant mortality
included)
- Shareholder Value 6.25%
(increase shareholder value 20%
from IPO = $24 per share)
b) Individual Objectives (25% of base)
- Bookings @ 100% of plan (10%)
- Sales headcount @ target internal plan
(5%)
- Sales rep quota participation (non
ramp AE's) greater than 60% (5%)
- Sales staff turnover less than 25%
for Q3 and Q4 (5%)
c) Bonus Accelerator (capped at incremental 25%)
- Finish at greater than or equal to
125% of Business plan target 10%
- Finish at greater than or equal to
150% of Business plan target 25%
- We will recommend to our Board of Directors a stock
option grant to you of 100,000 incentive stock options
under Net2000's Employee Equity Incentive Plan. These
incentive stock options will vest at a rate of 20% on
the sixth month anniversary date and the balance
(80,000) will vest 1/36th every month thereafter. This
will not affect the annual January option reload.
Thirty-three percent (33%) of any unvested options will
vest upon a change of control. These options will change
in value directly with the value of the company, and as
long as the value of the Company keeps increasing, so
does the value of the options. All stock option grants
are at the discretion of our Board and must be
authorized by the Board. The strike price of each such
option will be set by Board of Directors Compensation
Committee which typically meets on the last Friday of
each month.
- A one time relocation allowance of $7,500 .
- A monthly car allowance of $600
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Xxxx Xxxxxxx
July 26, 2000
Page 3 of 4
4. Net2000 Communications is an "at will" employer. This means that
either you or Net2000 may terminate your employment relationship at any
time, for any reason, with or without cause or advance notice. This
offer is contingent upon your execution of our
non-compete/non-disclosure employment agreement, which is enclosed, and
satisfactory completion of any reference checks that we feel are
appropriate. We further understand from you that this offer and your
employment with Net2000 are not in conflict with any existing or
previous employment agreement, including any non-competition agreement.
5. You will be eligible for the standard Net2000 health, life
insurance, 401(k) Program and other benefits plans. You will receive
three weeks paid vacation, as well as all holidays listed in our
Employee Handbook.
6. You shall receive three (3) weeks paid vacation per annum.
7. To the extent not otherwise set forth in this Agreement, the
conditions of your employment shall be governed by the operating and
personnel policies of the Company.
8. The Company may terminate your employment at any time, upon
written notice of termination, for Cause. A termination for Cause is
defined as: (a) your failure to perform your duties as Vice President
Carrier Sales and Alternate Channels which results in material harm to
the Company; or (b) your conviction of a felony or a crime involving
moral turpitude. Upon termination of your employment for Cause, you
shall not be entitled to any severance pay. Such termination for Cause
shall be effective immediately.
9. The Company may also terminate your employment at any time, upon
written notice of termination, for any reason other than for Cause. In
such event, the effective date of your termination shall be the date of
delivery of notice of termination. After the effective date of
termination, you shall receive severance pay equal to your then-current
base salary, plus applicable bonus on a prorated basis, for six (6)
months, paid in accordance with the payroll process and procedures in
effect as of termination.
10. In the event the Company or its successor terminates your
employment without cause or in anticipation of or subsequent to a sale
or merger then you shall be entitled to the severance pay set forth in
paragraph 8 and you shall immediately vest in 100% of any unvested stock
options as of the date of your termination.
11. In the event that you terminate your employment with the Company
for any other reason, your termination shall be treated solely for the
purposes of this Agreement, as a termination by the Company for Cause.
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July 26, 2000
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12. You agree not to engage in any other employment or activity at
any time during your employment with the Company that interferes with
the performance of your duties for the Company. You agree to enter into
and abide by the Company's Employee Non-Competition Agreement And
Condition Of Employment and any agreements contemplated by the Company's
standard policies and procedures, such as agreements concerning Foreign
Corrupt Practices Act compliance. In the event you acquire any of the
Company's Common Stock, you agree to enter into and abide by any
agreements generally executed by the stockholders of the Company, such
as a trading "standstill agreement" in connection with an IPO.
13. You hereby represent to the Company that your performance of all
of the terms of this Agreement and your performance as an employee of
the Company does not and will not breach any agreement to keep in
confidence proprietary information which you have acquired from any
third party in confidence or in trust prior to your employment by the
Company. You also represent that you have not entered into, and you
agree that you will not enter into, any agreement either written or oral
in conflict with the terms of this Agreement.
14. This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Virginia without regard to its
conflicts of laws principles or rules.
15. This Agreement contains the entire agreement between the Company
and yourself concerning the subject matter hereof. If the terms of this
Agreement are acceptable to you, please sign and return the enclosed
copy of this Agreement, confirming your agreement with the foregoing.
Xxxx, I am extremely optimistic about the future of Net2000. You will play a
major role in our growth and success and I look forward to working closely with
you to make it happen.
Best regards,
/s/Xxxxxxx X. Xxxxxx, Xx.
Xxxxxxx Xxxxxx
Chief Executive Officer
ACCEPTED AND AGREED:
/s/Xxxx Xxxxxxx 8/1/00
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Xxxx Xxxxxxx Date
