EXHIBIT 10.6
AMENDMENT TO EMPLOYMENT AGREEMENT
This agreement is dated as of the 1st day of October, 1998, and is an amendment
to the employment agreement between PSINet Inc. (the "Company") and Xxxxx Xxxxx
("Xxxxx"), dated August 4, 1997. Except as modified or otherwise provided
herein, all terms and provisions of that employment agreement remain in effect.
This amendment is to provide certain changes in the employment of Xxxxx related
to a new assignment in Switzerland as President, Europe for the Company, as well
as a new designation as Senior Vice President of the Company.
1. Reporting, Responsibility and Term. Xxxxx shall continue to report to the
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Chief Operating Officer of the Company. In his role as President, Europe,
he shall have operating authority over the Company's European operations
and responsibility for the results of those operations. His terms as
President, Europe shall commence as of the date hereof, and extend through
December 31, 2000, unless earlier terminated or modified by the Company or
Xxxxx in accordance with the other provisions of Xxxxx' employment
agreement.
2. Base and Bonus Compensation. Xxxxx shall be paid base salary at a rate of
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$225,000 per year, on the same terms as otherwise provided in the
employment agreement. In addition, Xxxxx shall be eligible for up to
$112,500 in additional bonus compensation, payable annually, upon
achievement of stated goals to be mutually agreed with the Chief Operating
Officer.
3. Adjustment of Differential Tax Rates. If necessary, the Company shall
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"gross up" Xxxxx' base, bonus and personal travel compensation so that
Xxxxx' after-tax compensation during his tour in Switzerland shall not be
less than he would have had if stationed in the United States for such
period and earning the identical compensation. In other words, if the
combined relative personal tax rate on such compensation is increased by
reason of Xxxxx' location in Switzerland, the Company shall increase the
compensation such that the after-tax results to Xxxxx shall eliminate any
loss in compensation otherwise caused by the increased tax rate.
4. Travel to the U.S. The Company shall reimburse Xxxxx up to $20,000 (per
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year) for personal travel expenses between Switzerland and the U.S. This
reimbursement shall pertain to travel for Xxxxx or any member of his
immediate family (i.e., wife and children).
5. Automobile. The Company shall provide Xxxxx with a suitable automobile in
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Switzerland, with the Company bearing all related costs (insurance,
registration, leasing, fuel, maintenance, etc.).
6. Accommodations and Related Expenses. The Company shall pay for a suitable
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rental unit for Xxxxx in or near Geneva, Switzerland, including all
utilities, parking and related costs. The Company shall also pay for a one-
time relocation allowance of one-month's salary in lieu of expenses for
setting up Xxxxx' new household, and a similar allowance upon Xxxxx' return
to the U.S. If Xxxxx should need to engage the services of a destination
services company or real estate agent for the purpose of finding suitable
housing in Switzerland, the Company shall pay for the charges and fees
related to such company or agent.
In Switzerland, the Company shall provide Xxxxx with home telephone lines
to support his business requirements, as well as mobile telephone service.
In addition, the Company shall
reimburse Xxxxx for grounds maintenance and utilities costs incurred by
Xxxxx with respect to his permanent residence in the United States.
7. Freight. The Company shall pay for the shipment of necessary household
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goods to Switzerland (and back) for Xxxxx, as well as for associated
packing and in-transit insurance in an amount not to exceed $100,000. The
Company shall also provide, if necessary, the services of a professional
organizer to facilitate Xxxxx' move to and from Switzerland.
8. Work Permit. The Company shall secure a work permit for Xxxxx (as well as a
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permit for Xxxxx' wife, if she does not have the services of her employer
for such purpose).
9. COLA. The Company shall pay to Xxxxx, if indicated by a Runzheimer or
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similar analysis of the differential cost of living between Metropolitan
Washington, D.C. and Geneva, Switzerland, a Cost of Living Adjustment (in
the form of monthly additions to his base salary), not to exceed 15% of
such salary.
AGREED as of this 1/st/ day of October, 1998.
/s/ Xxxxxx X. Xxxxx
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For PSINet Inc.
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx
