Exhibit 10.8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as of this
25th day of January, 1999, by and between, InSite Internet, Inc., a Delaware
corporation (the "Company") and Xxxxxx X. Xxxxxxxx, an individual with a mailing
address at 000 Xxx Xxxxxxxx Xxxx, Xxxxxxxxxx, XX 00000 ("Employee").
INTRODUCTION
The Company is in the business of acquiring internet service provider
businesses and intends to consummate an initial public offering of its common
stock within the next one hundred and twenty (120) days (the "IPO"). Employee
possesses skills and knowledge advantageous to the Company. The Company desires
to employ Employee and Employee desires to accept such employment on the terms
and conditions set forth herein.
AGREEMENT
In consideration of the premises and mutual promises hereinbelow set
forth, the parties hereby agree as follows:
1. EMPLOYMENT; DUTIES. Subject to the terms and conditions set
forth herein, the Company hereby employs Employee during the Employment Period
(as defined below), and Employee hereby accepts such employment. Employee agrees
to be a full-time employee of the Company and devote his full and exclusive
time, energy, skill and best efforts to the business of the Company and to the
fulfillment of Employee's duties hereunder. Employee's duties include, but are
not limited to, (i) serving as Chief Financial Officer of the Company; (ii)
assisting in the internal growth of the Company's business; and (iii) other
duties assigned to Employee by the CEO of the Company from time to time
consistent with Employee's position.
2. EMPLOYMENT PERIOD. Subject to earlier termination pursuable to
SECTION 4 and SECTION 5 below, this Agreement shall commence on the date hereof
and continue for a one (1) year period (the "Employment Period"). Thereafter,
this Agreement shall automatically renew for additional one (1) year periods
unless the Company gives the Employee ninety (90) days written notice of its
intention not to renew prior to the end of the then current one (1) year term.
3. COMPENSATION AND BENEFITS.
3.1 SALARY. During the Employment Period, the Company agrees
to pay Employee at the rate of $125,000 per annum ("Base Salary"). Employee's
salary shall be
subject to customary withholdings and be payable to Employee on the regularly
occurring pay period established time to time by the Company.
3.2 HEALTH BENEFITS. During the Employment Period, the
Company shall provide Employee with family health care coverage, as provided by
health care provider(s) selected by the Company from time to time.
3.3 BONUS. During the Employment Period, Employee shall be
eligible for discretionary bonuses based upon realization of specific growth
objectives determined by the Company including, but not limited to, additional
acquisitions following the IPO.
3.4 RETIREMENT PLAN. During the Employment Period, Employee
shall be entitled to participate in any 401(k) or similar benefit/profit sharing
plan adopted by the Company for the benefit of its employees. The Company
reserves the right to modify, terminate or withdraw any such plan (if so
adopted) at any time in its sole discretion.
3.5 STOCK OPTIONS. Employee shall receive an initial grant
of incentive stock options for 30,000 shares of common stock of the Company with
a three (3) year vesting plan (i.e. 10,000 per year) at end of each of the
initial three anniversary dates of employment (i.e. January 25, 2000, January
25, 2001 and January 25, 2002), provided any options not vested upon termination
of employment shall terminate. A customary option agreement shall be provided to
Employee by the Company. The exercise price for such option shall be the IPO
price per share of the common stock.
3.6 VACATION. Employee may take up to three (3) weeks paid
vacation in each calendar year during the Employment Period.
3.7 RELOCATION: MOVING EXPENSES. Following consummation of a
successful IPO, Employee will relocate to New Jersey upon request of the
Company. In such event, the Company shall reimburse Employee for any temporary
hotel/travel expenses prior to permanent relocation and for moving expenses for
home furnishings.
4. TERMINATION BY THE COMPANY FOR CAUSE. Upon written notice to
Employee, the Company may terminate this Agreement for cause if any of the
following events shall occur: (i) any breach of this Agreement by Employee; (ii)
the commission of a felony by Employee; or (iii) the commission of an act by
Employee involving fraud, theft or dishonesty. In the event of a termination
pursuant to this SECTION 4, all obligations of the Company under this Agreement
shall cease and any stock options which have not vested shall terminate.
5. TERMINATION WITHOUT CAUSE.
5.1 BY EMPLOYER. The Company may terminate this Agreement at
any time without cause upon thirty (30) days written notice to Employee. In such
event, the Company shall, for the greater of six (6) months or the remainder of
the initial one-year term
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(i) pay Employee during regular payroll periods (less customary withholding
taxes) the Base Salary and (ii) provide the health benefits described in SECTION
3.2. Provided, however, in either case the Company's severance obligations
hereunder will end on the date Employee secures new employment.
5.2 BY EMPLOYEE. Employee may terminate this Agreement at
any time upon one hundred and twenty (120) days prior written notice to the
Company. In such case, Employee shall not be eligible for any severance payments
or other benefits after the date of termination.
5.3 TERMINATION OF STOCK OPTIONS. In the event of a
termination pursuant to this SECTION 5, any stock options which have not vested
shall terminate.
6. CONFIDENTIALITY AND NON-DISCLOSURE. Employee recognizes and
acknowledges that during the Employment Period he will have access to certain
confidential information relating to the Company and its affiliates, including,
but not limited to, operational policies, financial information, marketing
information, personnel information, trade secrets, customer information
(including customer lists), and pricing and cost policies, that are valuable,
special and unique assets of the Company (collectively, "Confidential
Information"). Employee agrees that he will not use or disclose such
Confidential Information to any person, firm, corporation, association or other
entity for any purpose or reason whatsoever, except as is required in the course
of performing his duties hereunder unless (i) such information becomes known to
the public generally through no breach by Employee of this covenant or (ii)
disclosure is required by law or any governmental authority or is required in
connection with the defense of a lawsuit against the disclosing party, provided,
that prior to disclosing any information pursuant to this clause (ii), Employee
shall give prior written notice thereof to the Company and provide the Company
with the opportunity to contest such disclosure. Employee agrees that, both
during the Employment Period and for a period of twenty-four (24) months after
the termination of this Agreement, Employee will hold in a fiduciary capacity
for the benefit of the Company, and shall not directly or indirectly use or
disclose, except as authorized by the Company in connection with the performance
of Employee's duties, any Confidential Information, that Employee may have or
may acquire (whether or not developed or compiled by Employee and whether or not
Employee has been authorized to have access to such Confidential Information)
during the term of this Agreement. The covenants contained in this SECTION 6
shall survive for the Employment Period and for a period of twenty-four (24)
months thereafter; provided, however, that with respect to those items of
Confidential Information which constitute trade secrets under applicable law,
Employee's obligations of confidentiality and non-disclosure as set forth in
this SECTION 6 shall continue to survive after the applicable period above to
the greatest extent permitted by applicable law. These rights of the Company are
in addition to those rights the Company has under the common law or applicable
statutes for the protection of trade secrets.
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7. NON-COMPETITION. Employee expressly covenants and agrees that
for the Employment Period and for a period of twenty four (24) months
thereafter, he shall not, directly or indirectly, seek, obtain or accept a
"Competitive Position" in the "Restricted Territory" with a "Competitor" of the
Company (as such terms are hereafter defined). For purposes of this Agreement, a
"Competitor" of the Company means any business, individual, partnership, joint
venture, association, firm, corporation or other entity engaged, wholly or
partly, in the business of selling internet access service or in any related
business which the Company and/or its affiliates may engage in from time to time
during the term of this covenant; the "Restricted Territory" means each state of
the United States of America in which the Company and/or its affiliates
transacts business during the term of this covenant; a "Competitive Position"
means any employment with any Competitor of the Company whereby Employee will
use or is likely to use any Confidential Information, or whereby Employee has
duties for such Competitor that are the same or substantially similar to those
actually performed by Employee pursuant to the terms hereof. Nothing contained
in this SECTION 7 is intended to prevent Employee from investing in stock or
other securities listed on a national securities exchange or actively traded on
the over the counter market or any corporation engaged, wholly or partly, in the
sale of telecommunications products or services; provided, however, that
Employee and members of his immediate family shall not, directly or indirectly,
hold more than a total of two percent (2%) of all issued and outstanding stock
or other securities of any such corporation.
8. NON-SOLICITATION.
8.1 NON-SOLICITATION OF CUSTOMERS. Employee agrees that he
will not take any customer lists of the Company after leaving his employ and
that he will, for the Employment Period and for a period of twenty-four (24)
months thereafter, refrain from soliciting or attempting to solicit directly or
by assisting others, any business from any of the Company's customers, including
actively sought prospective customers, with whom Employee had "material contact"
during the employment for purposes of providing products or services.
8.2 NON-SOLICITATION OF EMPLOYEES. Employee agrees that he
will, for the Employment Period and for a period of twenty-four (24) months
thereafter, refrain from recruiting or hiring, or attempting to recruit or hire,
directly or by assisting others, any other employee of the Company who is
employed by the Company or any successor or affiliate of the Company.
9. TOLLING OF PERIOD OF RESTRAINT. Employee hereby expressly
acknowledges and agrees that in the event the enforceability of any of the terms
of this Agreement shall be challenged in court and Employee is not enjoined from
breaching any of the restraints set forth in SECTION 6 through SECTION 8, then
if a court of competent jurisdiction finds that the challenged restraint is
enforceable, the time period of the restraint shall be deemed tolled upon the
filing of the lawsuit challenging the enforceability of the restraint until the
dispute is finally resolved and all periods of appeal have expired.
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10. ACKNOWLEDGEMENTS. Employee hereby acknowledges and agrees that
the restrictions contained in SECTION 6 through SECTION 9 are fair and
reasonable and necessary for the protection of the legitimate business interests
of the Company. Employee acknowledges that in the event Employee's employment
with the Company terminates for any reason, Employee will be able to earn a
livelihood without violating the restrictions contained in SECTION 6 through
SECTION 9 and that Employee's ability to earn a livelihood without violating
such restrictions is a material condition to Employee's employment and continued
employment with the Company. Employee expressly agrees that the character,
duration and geographical scope of the covenants contained in this SECTION 6
through SECTION 9 are reasonable in light of the circumstances as they exist at
the date upon which this Agreement has been executed. However, should a
determination nonetheless be made by a court of competent jurisdiction at a
later date that the character, duration or geographical scope of the covenants
contained herein are unreasonable in light of the circumstances as they then
exist, then it is the intention of both Employee and the Company that these
covenants shall be construed by the court in such a manner as to impose only
those restrictions on the conduct of Employee which are reasonable in light of
the circumstances as they then exist and necessary to assure the Company of the
intended benefit of these covenants.
11. RIGHTS TO MATERIALS; WORK FOR HIRE. All records, files,
memoranda, reports, price lists, customer lists, drawings, plans, sketches,
documents and the like (together with all copies thereof) relating to the
business of the Company, which Employee shall use or prepare or come in contact
with in the course of, or as a result of, his employment shall, as between the
parties hereto, remain the sole property of the Company. Upon the termination of
Employment or upon the prior demand of the Company, Employee shall immediately
return all such materials and shall not thereafter cause removal thereof from
the premises of the Company. Employee agrees to disclose and assign to the
Company as its exclusive property, all ideas, writings, inventions, discoveries,
improvements and technical or business innovations made or conceived by
Employee, whether or not patentable or copyrightable, either solely or jointly
with others during the Employment Period and for a period of two (2) years
thereafter whether or not made or conceived during regular hours of work or
otherwise, which are along the lines of the business, work or investigations of
the Company or its affiliates. Employee agrees to execute any and all documents
hereafter requested by the Company necessary to further effectuate the
foregoing.
12. REMEDIES. Without limiting the Company's right to claim
damages, Employee acknowledges that the Company will be irreparably harmed by a
breach of any provision of this Agreement and Employee agrees that the Company
shall be entitled to injunctive relief in the event of such breach.
13. GOVERNING LAW; ARBITRATION; JURISDICTION; VENUE; ATTORNEY'S
FEES. This Agreement is made and entered into in and shall be governed by and
interpreted in accordance with the laws of, the State of New Jersey. The Company
and Employee agree that any dispute regarding this Agreement shall be submitted
to arbitration to and shall be resolved in
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accordance with the rules of the JAMS/Endispute for expedited cases then in
effect. The arbitrator(s) shall be mutually selected by the parties or in the
event the parties cannot mutually agree, then appointed by JAMS/Endispute. Any
arbitration shall be held within a forty-five (45) mile radius of Spring Lake,
New Jersey and the arbitrator(s) shall apply New Jersey law. Judgment upon any
award rendered by the arbitrator(s) shall be final and may be entered in any
court of competent jurisdiction. Notwithstanding the foregoing, the Company
shall have the absolute right to obtain equitable remedies in any state court of
competent jurisdiction in the State of New Jersey or in the United States
District Court in the state of New Jersey. By his execution and delivery of this
agreement, Employee irrevocably submits to and accepts the exclusive
jurisdiction of each of such courts and waives any objection (including any
objection to venue or any objection based upon the grounds of forum non
conveniens) which might be asserted against the bringing of any such action,
suit or other legal proceeding in such courts. The court and/or arbitrator(s)
shall award costs and expenses (including reasonable attorney's fees) to the
prevailing party in any litigation or arbitration.
14. MISCELLANEOUS.
14.1 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and supersedes any and all previous agreements, written and oral, regarding the
subject matter hereof between the parties hereto. This Agreement shall not be
changed, altered, modified or amended, except by a written agreement signed by
both parties hereto.
14.2. NOTICES. All notices, requests, demands and other
communications required or permitted to be given or made under this Agreement
shall be in writing and shall be deemed to have been given if delivered by hand,
sent by generally recognized overnight courier service, telex or telecopy, or
mail,
(a) to the Company: With a copy to:
InSite Internet., Inc. Xxxxx & Xxxxxxx, LLP
0000 Xxxxx Xxxxxx 000 Xxxxx Xxxx Xxxxxxxx
Xxxxxx Xxxx, XX 00000 Xxxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxx, CEO Attention: Xxxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
(b) to the Employee at:
Xxxxxx X. Xxxxxxxx
000 Xxx Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
(000) 000-0000
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14.3 ASSIGNMENT. The Company may assign this Agreement to
(i) any entity controlling, controlled by or under common control with the
Company or (ii) to any purchaser of the Company's assets provided that such
purchaser agrees to assume the Company's obligations hereunder.
14.4. SEVERABILITY. If any term or provision of this
Agreement, or the application thereof to any person or under any circumstance,
shall to any extent be invalid or unenforceable, the remainder of this
Agreement, or the application of such terms to the persons or under
circumstances other than those as to which it is invalid or unenforceable, shall
be considered severable and shall not be affected thereby, and each term of this
Agreement shall be valid and enforceable to the fullest extent permitted by law.
The invalid or unenforceable provisions shall, to the extent permitted by law,
be deemed amended and given such interpretation as to achieve the economic
intent of this Agreement.
14.5. WAIVER. The failure of any party to insist in any one
instance or more upon strict performance of any of the terms and conditions
hereof, or to exercise any right or privilege herein conferred, shall not be
construed as a waiver of such terms, conditions, rights or privileges, but same
shall continue to remain in full force and effect. Any waiver by any party of
any violation of, breach of or default under any provision of this Agreement by
the other party shall not be construed as, or constitute, a continuing waiver of
such provision, or waiver of any other violation of, breach of or default under
any other provision of this Agreement.
14.6 TITLES; GENDER. Section and subsection titles are for
convenience of reference only and are not to be considered in the interpretation
or construction of any of the provisions hereof. All pronouns or any variations
thereof contained in this Agreement refer to the masculine, feminine or neuter
as the identity of the person may require.
14.7 SURVIVAL. SECTION 6 through SECTION 14 hereof shall
survive any termination of this Agreement.
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14.8 EXECUTION IN COUNTERPARTS. This Agreement may be
executed in counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same document.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
COMPANY:
ATTEST: INSITE INTERNET, Inc.
/s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxx
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Xxxxxxx X. Xxxxxxx,Assisitant Secretary Xxxx X. Xxxxx, President
WITNESS: EMPLOYEE:
/s/ Xxxxxx Xxxxxxx /s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
In consideration of Employee's acceptance of this Agreement, Xxxx X.
Xxxxx hereby agrees to provide additional capital to the Company as necessary to
meet the Company's payment obligations to Employee hereunder.
Acknowledged and Agreed:
/s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx
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