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Exhibit 10.16A
KEY EMPLOYEE EMPLOYMENT AGREEMENT ADDENDUM
This ADDENDUM to the KEY EMPLOYEE EMPLOYMENT AGREEMENT (executed on June 21,
1999) ("Agreement") entered into this ______ day of February, 2001 by and
between ADVANCED SWITCHING COMMUNICATIONS, INC., a Delaware corporation
("Employer") and Xxxxx D'Xxxxxx ("Employee"), an individual resident of Potomac,
MD is effective as of the 31st day of December 2000.
SECTION 3 e is hereby added as follows:
STOCK OPTIONS: A new hire stock option grant of 180,000 shares of ASC's common
stock is awarded with Board approval subject to the Second 1998 Nonqualified
Stock Option Plan. The vesting period for the options is 45,000 (25%) shares on
June 21, 2000 which is the 1-year anniversary of the effective date of the
grant, 45,000 (25%) shares on June 21, 2001, 45,000 (25%) shares on June 21,
2002, and the remaining 45,000 (25%) shares on June 21, 2003 provided the
employee is employed on these dates. In case of Change of Control as described
within the Stock Option Plan, all remaining options will fully vest.
SECTION 10 b is amended as follows:
b. WITHOUT CAUSE: Without cause, the Employee may terminate this Agreement
upon two (2) weeks written notice to the Employer. In such event, Employee shall
continue to render his services up to the date of termination. Without cause,
the Employer may terminate this agreement at any time by paying one year's base
salary. Termination without cause by Employee shall mean the voluntary
termination of the Agreement by Employee. In such event, Employee, if requested
by the Employer, shall continue to render his services and shall be paid his
regular compensation, including any declared but unpaid bonuses, up to the date
of termination.
SECTION 10 c is hereby added as follows:
c. CONSTRUCTIVE DISMISSAL: If one of the following events occur during
Employee's employment, then Employee may resign his ASC employment as being
constructively dismissed and receive payment of one year's base salary.
1. If Employee is demoted from the position of Chief
Financial Officer (which title may be changed)
without his consent.
2. If Employee's duties are materially reduced or the
level of his job responsibilities is materially
reduced without his consent.
3. If Employee's base salary is reduced.
The remainder of the KEY EMPLOYEE EMPLOYMENT AGREEMENT dated June 21, 1999 will
remain in full force and effect. In WITNESS WHEREOF, the parties have executed
this Agreement on the day and year first above written.
EMPLOYER: EMPLOYEE:
ASC, INC.
BY: _______________________ BY: _____________________
Title: _____________________
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EXECUTIVE SEPARATION AGREEMENT
This Executive Separation Agreement (the Agreement) is entered into
this 15th day of March, 2001, between Advanced Switching Communications, Inc.
("ASC") and Xxxx Xxxxx (the "Executive") (sometimes collectively referred to as
the "Parties").
WHEREAS:
A. Executive was employed by ASC as a Sr. Vice President of Sales
and by mutual agreement, Executive's employment with ASC shall be deemed
terminated effective as of March 15, 2001 through Executive's resignation of
employment.
B. Company and Executive now desire to resolve all disputes,
claims or charges that may exist between them in any way relating to or arising
out of Executive's hire, employment, remuneration or termination from ASC, in
accordance with the terms and conditions set forth herein.
AGREEMENT
Now, therefore, in consideration of the mutual promises, conditions and
covenants set forth below, the parties hereto agree as follows:
1 Executive's Termination of Employment
1.1 By virtue of ASC waiving the required two week notice period
for resignation of employment, Executive hereby acknowledges
that her employment with ASC shall be deemed terminated
effective as of March 15, 2001 and she is providing a
resignation letter simultaneously with the execution of this
Agreement (the Termination Date).
2 Separation Payments
2.1 ASC shall provide Executive with separation payments equal to
her base pay less statutory withholdings on ASC's normal
payroll schedule until September 15, 2001, (the Separation
Payments) once this agreement is irrevocable.
2.2 Vacation pay accrued but not taken by Executive as of the
Termination Date shall be paid to Executive following March
15, 2001.
2.3 The Separation Payment shall be paid by check made payable to
Executive and shall be mailed to Executive at 0000 XX 00xx
Xxxxxxx, Xxxx Xxxxx, XX 00000 unless ASC is otherwise notified
in writing.
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3 Medical Insurance and Other Benefits
3.1 Executive acknowledges that, subject to her rights under the
CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT (COBRA), she
may continue to remain covered under ASC's medical and dental
insurance plans at her own expense for up to eighteen (18)
months. During the six month period from March 15, 2001
through September 15, 2001 that ASC is providing separation
payments as described in article 2.1 above, ASC
contemporaneously will underwrite the costs of Executive's
COBRA coverage if she elects to continue her health insurance
coverage under COBRA.
3.2 As of the termination date, Executive's vested options as of
March 15, 2001 for 125,000 shares of company common stock
shall be exercisable in accordance with Exhibit A attached
hereto. All other options previously granted to employee shall
expire and terminate on the Termination Date.
3.3 ASC is willing to reimburse you for reasonable business
expenses incurred by you on behalf of the company within 14
days after they have been submitted as long as they have been
submitted within 30 days of your termination date and are
submitted in accordance with company policy including, any
appropriate documentation that may reasonably be requested by
the company.
4 No Other Amounts Owed
4.1 The payments and items provided for in articles 2 and 3 above
shall constitute the entire, maximum, and only financial or
other obligation of ASC to Executive under this Agreement or
otherwise.
4.2 Executive expressly acknowledges and agrees that the payments
provided for in this Agreement are in lieu of and exceed any
other compensation or payments to which she may be entitled by
virtue of her employment with and/or termination from ASC.
5 No Admission
5.1 Neither the payment of the above-referenced amounts, nor the
execution or performance of any terms of this Agreement shall
constitute or be construed as an admission of any liability
whatsoever by ASC to Executive.
6 Employment Reference and Nondisparagement
6.1 If ASC receives any inquiries from prospective future
employers of Executive, ASC shall confirm only dates of
employment and position held.
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6.2 ASC, through the officers named below, and Executive will not
orally or in writing defame, criticize or willfully disparage,
or in any manner undermine the reputation of the other, and in
the case of ASC, includes any subsidiary or affiliated
corporation of ASC itself, or any employee, officer or
director of the Company or any subsidiary or affiliate of the
Company, except as required by compulsion of law to truthfully
testify. A disparaging statement is any communication, oral or
written, which is intended, or would tend, to cause the
recipient of the communication to question the business
condition, quality of products and services, legal compliance,
integrity, competence, fairness or good character of ASC or
the person to whom the communication relates. The ASC officers
bound by this provision are Xxxxx D'Xxxxxx, Xxxxxx Xxxxxxx,
Xxxxx Xxxxx, Xxxxxx Xxxxxxx, Xxx Xxxxxxxxx, Xxx Xxxxxxxxx,
Xxxxxxx Range, Xxxx Xxxx, Xxxx Xxxxxx, and Xxx Ma.
7 Release
7.1 For the valuable consideration set out in this Agreement, the
receipt and adequacy of which are hereby acknowledged, and
except as specifically set forth in paragraph 7.5 below:
7.1.1 Executive, on behalf of herself, and each of her
heirs, executors, administrators, successors and
assigns, does hereby release and forever discharge
ASC, and any of its parent companies, subsidiaries,
affiliates, divisions, predecessors, successors,
agents, representatives, officers, directors,
employees, shareholders, heirs, assigns, past and
present, and their attorneys, and all persons acting
by, through, under or in concert with them or any of
them (the ASC Releasees), of and from any and all
manner of action or actions, cause or causes of
action, in law or in equity for indemnity or
otherwise, suits, grievances, arbitrations,
complaints, debts, liens, contracts, agreements,
promises, liabilities, claims, demands, damages,
losses, costs, or expenses, of any nature whatsoever,
known or unknown, fixed or contingent (hereinafter
called Claims), which the Executive now has or may
hereafter have against the ASC Releasees, by reason
of any matter, cause or thing whatsoever occurring or
existing up to and inclusive of the Effective Date of
this Agreement, including but not limited to those
claims arising out of:
7.1.1.1 the contract of employment between Executive
and ASC;
7.1.1.2 the termination of the contract of
employment between Executive and ASC;
7.1.1.3 Executive's loss of position, status, future
job opportunity, or reputation;
7.1.1.4 losses related to the timing of Executive's
conclusion of employment or the manner in
which it was effected;
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7.1.1.5 the loss of benefits, benefits eligibility,
or benefits insurance coverage previously
provided to Executive by ASC or available to
Executive in connection with her employment
with ASC , including but not limited to
benefits, benefits eligibility or benefits
insurance coverage relating to or arising
from the following matters: medical fees,
charges, or expenses; extended health fees,
charges, or expenses; dental fees, charges,
or expenses; sick pay or sick leave; life
insurance (including life insurance
conversion privileges); 401(k)
contributions; pension contributions or
benefits; short term disability; long term
disability; the Stock Option Plan; and any
other type of loss or damages.
7.2 Without limiting the generality of the foregoing, the Claims
released herein include any Claims arising out of, based upon
or in any way related to:
7.2.1 any property, contract or tort claims, including
wrongful discharge, breach of employment contract,
breach of the covenant of good faith and fair
dealing, retaliation, intentional or negligent
infliction of emotional distress, tortious
interference with existing or prospective economic
advantage, negligence, misrepresentation, breach of
privacy, defamation, loss of consortium, breach of
fiduciary duty, violation of public policy or any
other common law claim of any kind;
7.2.2 any violation or alleged violation of Title VII of
the CIVIL RIGHTS ACT OF 1964, as amended, the AGE
DISCRIMINATION IN EMPLOYMENT ACT, as amended, the
OLDER WORKERS BENEFIT PROTECTION ACT OF 1990, the
EQUAL PAY ACT, as amended, the FAIR LABOR STANDARDS
ACT, the EMPLOYEE RETIREMENT INCOME SECURITY ACT, the
AMERICANS WITH DISABILITIES ACT, the CALIFORNIA FAIR
EMPLOYMENT AND HOUSING ACT, the CALIFORNIA LABOR
CODE, the CALIFORNIA UNEMPLOYMENT INSURANCE ACT, the
CALIFORNIA WORKERS COMPENSATION ACT, the CIVIL RIGHTS
ACT OF 1866, the CONSOLIDATED OMNIBUS BUDGET
RECONCILIATION ACT, CALIFORNIA LABOR CODE SECTION
1102.5, the CALIFORNIA FAMILY RIGHTS ACT, OR the
FAMILY AND MEDICAL LEAVE ACT OF 1993;
7.2.3 any claims for severance pay, bonus, sick leave,
vacation or holiday pay, life insurance, health,
disability or medical insurance or any other fringe
benefit; and
7.2.4 any claim relating to or arising under any other
local, state or federal statute or principle of
common law (whether in contract or in tort) governing
the employment of individuals, discrimination in
employment and/or the payment of wages or benefits.
7.3 IN ACCORDANCE WITH THE OLDER WORKERS BENEFIT PROTECTION ACT OF
1990, EXECUTIVE SHOULD BE AWARE OF THE FOLLOWING:
7.3.1 You have the right to consult with an attorney before
signing this Agreement;
7.3.2 You have twenty-one (21) days to consider this
Agreement; and
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7.3.3 You have seven (7) days after signing this Agreement
to revoke this Agreement, and this Agreement shall
not be effective until that revocation period has
expired. ASC reserves the right to withdraw this
Agreement prior to its acceptance by you.
Executive agrees that if she signs this Agreement but then
chooses to revoke this Agreement pursuant to subparagraph
7..3.3 above, this Agreement and all of its terms shall
immediately terminate including payments thereunder.
7.4 Executive acknowledges that she has been advised of and is
familiar with the provisions of the CALIFORNIA CIVIL CODE
SECTION 1542 which provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HER MUST HAVE
MATERIALLY AFFECTED HER SETTLEMENT WITH THE DEBTOR.
Executive, being aware of said Code section, hereby expressly
waives any rights she may have thereunder, as well as under
any other statutes or common law principles of similar effect.
7.5 Notwithstanding anything to the contrary set forth above, the
Parties expressly acknowledge and agree that the releases
contained in this article 7 are not intended to apply to:
7.5.1 the obligations and representations of the Parties
set forth in this Agreement;
7.5.2 Executive's rights, if any, to indemnity pursuant to
CALIFORNIA LABOR CODE 2802 and/or the CALIFORNIA
CORPORATIONS CODE 317.
7.6 Executive represents and warrants that there has been and
there shall be no assignment or other transfer of any interest
in any claim that she may have against ASC Releasees, or any
of them.
7.7 ASC agrees to release Executive from any and all civil claims
arising out of or in the course of her employment with ASC
with the exception of a release of claims constituting
criminal conduct. ASC further acknowledges that Executive's
only post-employment restrictions are contained within this
Executive Separation Agreement and that all restrictive
covenants and agreements not to compete previously agreed to
by parties (including those set forth in Section 7(b) of the
September 22, 2000 Employment Agreement between the parties)
are hereby cancelled and unenforceable.
7.8 The Parties agree that if any of them hereafter commences,
joins in, or in any manner seeks relief against any of their
respective releases through any suit arising out of, based
upon, or relating to any of the Claims releases hereunder or
in any manner asserts against their respective Releasees, or
any of them, any of the claims released hereunder, then that
party shall pay in addition to any other damages caused
thereby, all attorneys' fees and costs incurred by the
affected Releasees in defending or otherwise responding to
said suit or claim.
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8 Solicitation of Employees
8.1 Executive shall not under any circumstances solicit any
employees of ASC, its subsidiaries, affiliates, divisions,
predecessors, successors, agents, or representatives, to leave
their employment for a period of twenty-four (24) months after
the Termination Date.
8.2 Executive shall not:
8.2.1 solicit or otherwise encourage any employee or former
employee of ASC, it subsidiaries, affiliates,
divisions, predecessors, successors, agents, or
representatives, to file or assert any claim, charge
or litigation against ASC, its subsidiaries,
affiliates, divisions, predecessors, successors,
agents, or representatives, in any way relating to
their employment; or
8.2.2 voluntarily cooperate or otherwise offer assistance
of any kind to any employee or former employee of
ASC, its subsidiaries, affiliates, divisions,
predecessors, successors, agents, or representatives,
in the employees' or former employee's filing or
prosecution of any claim, charge or litigation
against ASC, its subsidiaries, affiliates, divisions,
predecessors, successors, agents, or representatives,
in any way relating to their employment, unless
compelled to do so by law.
9 Confidential Business Information and Tangible Property
9.1 Executive shall hold in strictest confidence and not disclose,
directly or indirectly, to any person, firm or corporation,
without the express prior written consent of ASC, any trade
secrets or any confidential business information, including,
but not limited to, corporate planning, production,
distribution or marketing processes; manufacturing techniques;
customer lists or customer leads; marketing information or
procedures; development work; work in process; financial
statements or notes, schedules or supporting financial data;
or any other secret or confidential matter relating to the
products, sales or business of company, its subsidiaries,
affiliates, divisions, predecessors, successors, agents, or
representatives. Trade Secrets include information not
generally known to the public regarding ASC's engineering
capabilities, products, designs and prototypes in development.
9.2 Executive agrees that within ten (10) days after the signing
of this Agreement she shall deliver to ASC and shall not keep
in her possession or deliver to anyone else, any and all
company credit cards, notes, memoranda, specifications,
financial statements, customer lists, product surveys, data,
documents, other material containing or disclosing any of the
matters referred to in paragraph 9.1 above and all other items
of ASC property in her possession.
9.3 Executive acknowledges that any breach of the provisions of
this article 9 by her shall cause irreparable injury to ASC,
for which the available remedies at law shall not be adequate.
Accordingly, in the event of any such breach or threatened
breach of any provision of this article in addition to any
other remedy provided by law or in equity, ASC
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shall be entitled to appropriate injunctive relief, in any
court of competent jurisdiction, restraining Executive from
any such actual or threatened breach of this article.
Executive stipulates to the entry against Executive of any
such temporary, preliminary or permanent injunction and agrees
not to resist ASC's application for such equitable relief,
except on the grounds that the acts or omissions alleged by
ASC did not violate any of the provisions of this article.
10 Confidentiality
10.1 In addition to the confidentiality provisions of article 9,
Executive shall keep confidential and not disclose any of the
terms of this Agreement to any person whatsoever (including,
but not limited to, any current or former employees of ASC
except her attorneys, tax advisors, immediate family and
significant other) unless required to do so by law.
11 Miscellaneous
11.1 This Agreement shall be governed by the law of the
Commonwealth of Virginia, Company's principal place of
business, without giving effect to Virginia's conflict of
laws. The parties hereto agree that the proper venue for any
dispute shall be the Fairfax County Circuit Court or the
United States District Court for the Eastern District of
Virginia, Alexandria Division and in the event that there is
no other manner of service hereby appoint the Secretary of the
Commonwealth of Virginia.
11.2 This Agreement shall not be subject to attack on the ground
that any or all of the legal theories or factual assumptions
used for negotiating purposes are for any reason inaccurate or
inappropriate.
11.3 This Agreement represents the sole and entire agreement among
the Parties and supersedes all prior agreements, negotiations,
and discussions between the Parties hereto and/or their
representatives. Any amendment to this Agreement must be in
writing specifically referring to this Agreement and signed by
duly authorized representatives of all of the Parties hereto.
11.4 The Parties agree that the language of this Agreement shall
not be construed for or against any particular party.
11.5 The provisions of this Agreement are severable. If any
provision is held to be invalid or unenforceable, it shall not
affect the validity or enforceability of any other provision.
11.6 Executive acknowledges and agrees that (i) ASC has advised her
of her right to consult an attorney before signing this
Agreement, (ii) she has consulted an attorney to the extent
she deems advisable, (iii) she fully understands the
provisions of this Agreement and their effect, and (iv) she is
signing this Agreement voluntarily and free from duress.
11.7 All monetary sums in this Agreement are in United States
currency.
11.8 This Agreement may be executed in one or more counterparts,
each of which is deemed an original, and all of which
constitute one instrument.
11.9 This Agreement shall be considered executed and delivered when
either:
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11.9.1 an originally executed copy has been delivered to
each party; or
11.9.2 when a facsimile of the Agreement evidencing this
signatures of all the Parties has been transmitted by
facsimile to each party and each party has
acknowledged receipt by return facsimile.
11.10 The Effective Date of this Agreement shall be that date which
is seven (7) days after the date on which Executive signs this
Agreement, provided that Executive has not exercised her right
to revoke this Agreement pursuant to subparagraph 7.3.3 above.
Witness our signatures and seals as of the date written below.
Advanced Switching Communications, Employee
Inc.
By:_____________________________(SEAL) ______________________(SEAL)
Title: Xxxx Xxxxx
Date:_______________________________ Date: ______________________
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EXHIBIT A
ADVANCED SWITCHING COMMUNICATIONS, INC.
NOTICE OF GRANT OF STOCK OPTIONS
ADDENDUM
Name of Participant: Xxxx Xxxxx
Address of the Participant: 0000 XX 00xx Xxxxxxx, Xxxx Xxxxx, XX 00000
Non-Qualified Stock Option Grant No: 00000300
Date of Grant: September 25, 2000
Total Number of Shares Granted: 500,000
Effective in accordance with the date your Executive Separation Agreement become
irrevocable, your stock grant No. 300, dated October 10, 2000 and referenced
above is amended such that you may exercise your vested options (125,000) at the
granted exercise price of $13.00 for up to six months after termination of your
employment on March 15, 2001. Therefore, all your unvested options will expire
upon termination of employment on March 15, 2001 and your vested options will
expire and all rights thereunder shall terminate on September 15, 2001 to the
extent they have not been exercised. All other provisions of the Advanced
Switching Communications, Inc. 2000 Stock Incentive Plan ("Plan") remain
unchanged and continue in full force and effect.
This amendment is made by the authority and with the approval of the Committee
appointed by the Board of Directors charged with administering the Plan.
By your signature and Advanced Switching Communications, Inc.'s signature by its
agent below, you agree that this option amendment and the initial option grant
are governed by the terms and conditions of Advanced Switching Communication's
2000 Stock Incentive Plan. Optionee represents that she is familiar with the
terms and conditions of the Grant Agreement and accepts the option and option
amendment subject to all the terms and conditions thereof. Optionee agrees to
accept as binding, conclusive and final all decisions or interpretations of the
Board of Directors of Advanced Switching Communications, Inc. upon any questions
arising under this agreement.
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For Advanced Switching Communications, Inc. Date
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Optionee Date
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