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EXHIBIT 10.5
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of June 4,
2001 between Xxxxxxx X. Xxxxxxxxxx, III, an individual ("Executive"), and High
Speed Access Corp., a Delaware corporation (the "Company").
RECITALS
A. The Company desires to employ Executive as its Vice President and
General Counsel and the Executive desires to serve as an employee of the Company
in that capacity.
B. The Company and Executive desire to set forth the terms and
conditions of Executive's employment with the Company in this Agreement.
AGREEMENT
THEREFORE, in consideration of the mutual covenants contained herein, the
parties hereby agree as follows:
1. Employment. The Company shall employ Executive in the position of Vice
President and General Counsel as such position has been defined in terms of
responsibilities and compensation as of the effective date of this Agreement.
Subject to Section 6.F of this Agreement, the Board of Directors of the Company
(the "Board") or the Compensation Committee of the Board (the "Committee") shall
have the right, at any time or from time to time, to revise such
responsibilities and compensation as the Board or the Committee in its
discretion may deem necessary or appropriate. Executive shall comply with and be
bound by the Company's operating policies, procedures and practices in effect as
of the date hereof. During the term of Executive's employment with the Company,
Executive shall continue to devote his full time, skill and attention to his
duties and responsibilities, and shall perform them faithfully, diligently and
competently, and Executive shall use his best efforts to further the business of
the Company and its affiliated entities; provided, however, that Executive may
serve on boards of directors or trustees of other companies or organizations so
long as such services do not materially interfere with the performance of his
duties hereunder and provided further that (i) if a Change in Control (as such
term is defined in Section 7.E of this Agreement) has not occurred, [a] such
service as a director or trustee is fully disclosed to the Committee by
Executive, [b] such service as a director or trustee is consistent with the
existing policies of the Company, including, without limitation, any ethics or
conflict of interest policies then in effect, and [c] the Committee approves
such service by Executive as a director or trustee, or (ii) if a Change in
Control has occurred, [x] such service as a director or trustee is fully
disclosed to the Committee or any successor thereto by Executive and [y] such
service as a director or trustee is consistent with the existing policies of the
Company, including, without limitation, any ethics or conflict of interest
policies then in effect.
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2. Term. The employment of Executive pursuant to this Agreement shall
commence on the date of this Agreement and continue for a one year period
thereafter (the "Employment Term"). The Employment Term may be terminated at any
time as provided in Section 6 hereof. Unless previously terminated, the
Employment Term shall automatically renew at the end of the initial term and
each subsequent term thereafter for an additional one-year period; provided
that, subject to Section 6.A of this Agreement, the Company may elect to
terminate this Agreement as of the end of the Employment Term, or any renewal
thereof, by written notice to Executive not less than sixty (60) days prior to
the end of the respective term.
3. Salary. As compensation for the services rendered by Executive under
this Agreement, the Company shall pay to Executive a base salary ("Base Salary")
initially equal to $16,666.68 per month, payable to Executive in accordance with
the Company's payroll practices as in effect from time to time during the
Employment Term. Subject to Section 6.F of this Agreement, the Base Salary shall
be subject to periodic adjustments by the Board or the Committee, in the sole
discretion of the Board or the Committee.
4. Bonus. In addition to his Base Salary, Executive shall be entitled to
participate in the Company's existing executive bonus program and such other
bonus and incentive plans as the Company may establish for the benefit of a
class of executives that includes Executive. The annual target bonus shall be
established by the Board or the Committee, in the sole discretion of the Board
or the Committee, and shall be payable based on achievement of specified Company
and individual objectives established by the Board or the Committee. Executive's
target bonus for each fiscal year of the Company on an annualized basis has been
set at 50% of Executive's Base Salary. Such bonus shall be payable within thirty
(30) days following the issuance of the Company's audited financial statements
for the preceding fiscal year.
5. Executive Benefits.
A. Employee and Executive Benefits. Executive will be entitled to
receive all benefits provided to senior executives and employees of the Company
generally from time to time, including participation in 401(k), medical, dental,
life insurance and short-term and long-term disability plans, so long as and to
the extent the same exist; provided, that in respect of each such plan Executive
is otherwise eligible and insurable in accordance with the terms of such plans.
B. Vacation, Sick Leave and Holidays. Executive shall be entitled to
vacation, sick leave and holidays in accordance with the policies of the Company
and its subsidiaries as they exist from time to time. Vacation, which is not
used during any calendar year, will not roll over to the following year.
C. Acceleration of Stock Options. Notwithstanding the provisions of a
stock option plan or option agreement to the contrary, if Executive's employment
is terminated by the Company following a Change in Control involuntarily and
without Business Reasons (as defined in Section 7.A hereof), all options to
purchase shares of common stock of the Company which may be granted to Executive
under the Company's 1999 Stock Option Plan shall immediately vest and become
exercisable, and all restrictions on any restricted stock granted to Executive
shall immediately lapse.
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6. Termination. This Agreement and the Employment Term may be terminated
at any time by Executive or the Company as provided in this Section 6.
A. Involuntary Termination by Company. If at any time during the
Employment Term other than within 12 months following a Change in Control, (i)
the Company terminates the employment of Executive involuntarily and without
Business Reasons or (ii) the Company notifies Executive in writing of its
intention to terminate this Agreement as of the end of the Employment Term or
renewal thereof pursuant to Section 2 hereof without Business Reasons, then
Executive shall be entitled to receive the following: (A) Base Salary and
vacation accrued through the Termination Date (as defined in Section 7.C hereof)
plus continued Base Salary for a period of 12 months following the Termination
Date (the "Severance Period"), payable in accordance with the Company's regular
payroll schedule as in effect from time to time, (B) any bonus payment
previously fixed and declared by the Board or the Committee on behalf of
Executive and not previously paid to Executive, (C) the right to exercise for
one year following the Termination Date (or such longer period as may be
provided in the applicable stock option plan or agreement) all outstanding stock
options held by Executive, but only to the extent such options were vested as of
the Termination Date, (D) continuation of group health benefits pursuant to the
Company's standard programs as in effect from time to time (or continuation of
substantially similar benefits, through a third party carrier, at the Company's
election), for a period of not less than 18 months (or such longer period as may
be required by COBRA), provided that Executive makes the necessary conversion,
with the cost of such benefits to be paid by the Company during the Severance
Period, and by Executive for any period beyond the Severance Period, and (E) no
other compensation, severance or other benefits. Notwithstanding the foregoing,
however, if Executive violates the provisions of Section 8 of this Agreement
during the Severance Period, the Company shall not be required to continue to
pay the salary or bonus specified in clause (A) or (B) hereof for any period
following the Termination Date, and in such event Executive shall be obligated
to repay to the Company any amounts previously received pursuant to clause (A)
or (B) hereof, to the extent the same relate to any period following the
Termination Date.
B. Termination for Death or Disability. If during the Employment Term,
Executive's employment shall be terminated by reason of death or Executive shall
become unable to perform his duties as an employee as a result of incapacity,
which gives rise to termination of employment for Disability (as defined in
Section 7.B hereof), then Executive or his estate shall be entitled to receive
the following: (A) Base Salary and vacation accrued through the Termination Date
only, (B) any bonus payment previously fixed and declared by the Board or the
Committee on behalf of Executive and not previously paid to Executive, (C)
continuation of group health benefits pursuant to the Company's standard
programs as in effect from time to time (or continuation of substantially
similar benefits, through a third party carrier, at the Company's election), for
a period of not less than 18 months (or such longer period as may be required by
COBRA), provided that Executive makes the necessary conversion, with the cost of
such benefits to be paid by Executive, (D) the right to exercise for one year
following the Termination Date (or such longer period as may be provided in the
applicable stock option plan or agreement) all outstanding stock options held by
Executive, but only to the extent such options were vested as of the Termination
Date, (E) such other benefits upon death or Disability, as the case may be, as
may then be established under the Company's then-existing severance and benefit
plans and policies at the time of such Disability or death, and (F) no other
compensation, severance or other benefits.
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Notwithstanding the foregoing, the Executive shall be entitled to receive that
portion of his Base Salary for a period of sixty (60) days from the Termination
Date, payable in accordance with the Company's regular payroll practices, only
and to the extent necessary so that, when included with the amounts, if any,
that Executive shall receive from the Company's then existing severance and
short-term disability or other benefit plans and policies at the time of
Executive's Disability, Executive shall receive an amount equal to the amount
Executive would have received (calculated on an after-tax basis) had Executive
continued to receive his Base Salary for a period of sixty (60) days following
the Termination Date.
C. Voluntary Termination or Termination for Business Reasons. If
during the Employment Term (i) Executive voluntarily terminates his employment
or elects not to extend the Employment Term (other than pursuant to Section 6.E
of this Agreement), or (ii) Executive is terminated involuntarily for Business
Reasons, then in any such event Executive shall be entitled to receive the
following: (A) Base Salary and accrued vacation through the Termination Date
only, (B) the right to exercise for thirty (30) days following the Termination
Date (or such longer or shorter period as may be provided in the applicable
stock option plan or agreement) all outstanding stock options held by Executive,
but only to the extent such options were vested as of the Termination Date, (C)
to the extent COBRA shall be applicable to the Company, continuation of group
health benefits pursuant to the Company's standard programs as in effect from
time to time (or continuation of substantially similar benefits through a third
party carrier, at the Company's election), for a period of 18 months (or such
longer period as may be applicable under the Company's policies then in effect)
following the Termination Date provided that Executive makes the appropriate
conversion and payments, and (D) no further severance, benefits or other
compensation.
D. Termination by Company Following Change in Control. If at any time
during the Employment Term and within 12 months of a Change in Control, (i) the
Company terminates the employment of Executive involuntarily and without
Business Reasons or (ii) the Company notifies Executive in writing of its
intention to terminate this Agreement as of the end of the Employment Term or
renewal thereof pursuant to Section 2 hereof without Business Reasons, then
Executive shall be entitled to receive the following: (A) Base Salary and
vacation accrued through the Termination Date plus continued Base Salary for a
period of 12 months following the Termination Date (the "Severance Period"),
payable in accordance with the Company's regular payroll schedule as in effect
from time to time, (B) any bonus payment previously fixed and declared by the
Board or the Committee on behalf of Executive and not previously paid to
Executive and, if Executive shall not have been paid a bonus for fiscal year
2001 pursuant to the Company's existing bonus plan, a payment equal to $75,000,
(C) the right to exercise for one year following the Termination Date (or such
longer period as may be provided in the applicable stock option plan or
agreement) all outstanding stock options held by Executive, (D) continuation of
group health benefits pursuant to the Company's standard programs as in effect
from time to time (or continuation of substantially similar benefits, through a
third party carrier, at the Company's election), for a period of not less than
18 months (or such longer period as may be required by COBRA), provided that
Executive makes the necessary conversion, with the cost of such benefits to be
paid by the Company during the Severance Period and by Executive for any period
beyond the Severance Period, and (E) no other compensation, severance or other
benefits. Notwithstanding the foregoing, however, if Executive violates the
provisions of Section 8 of this Agreement during
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the Severance Period, the Company shall not be required to continue to pay the
salary or bonus specified in clause (A) or (B) hereof for any period following
the Termination Date, and in such event Executive shall be obligated to repay to
the Company any amounts previously received pursuant to clause (A) or (B)
hereof, to the extent the same relate to any period following the Termination
Date.
E. Termination by Executive Following Change in Control. In the event
Executive's employment is not terminated by the Company during the first 12
months following a Change in Control as provided in paragraph D above, Executive
may terminate this Agreement upon sixty (60) days notice to the Company during
the period beginning on the first anniversary of the Change in Control and
ending on the 60th day following such first anniversary. In the event Executive
elects to so terminate this Agreement, then Executive shall be entitled to
receive the following: (A) Base Salary and vacation accrued through the
Termination Date plus continued Base Salary for a period of 12 months following
the Termination Date (the "Severance Period"), payable in accordance with the
Company's regular payroll schedule as in effect from time to time, (B) any bonus
payment previously fixed and declared by the Board or the Committee on behalf of
Executive and not previously paid to Executive, and, if Executive shall not have
been paid a bonus for fiscal year 2001 pursuant to the Company's existing bonus
plan, a payment equal to $75,000, (C) the right to exercise for one year
following the Termination Date (or such longer period as may be provided in the
applicable stock option plan or agreement) all outstanding stock options held by
Executive, (D) continuation of group health benefits pursuant to the Company's
standard programs as in effect from time to time (or continuation of
substantially similar benefits, through a third party carrier, at the Company's
election), for a period of not less than 18 months (or such longer period as may
be required by COBRA), provided that Executive makes the necessary conversion,
with the cost of such benefits to be paid by the Company during the Severance
Period, and by Executive for any period beyond the Severance Period, and (E) no
other compensation, severance or other benefits. Notwithstanding the foregoing,
however, if Executive violates the provisions of Section 8 of this Agreement
during the Severance Period, the Company shall not be required to continue to
pay the salary or bonus specified in clause (A) or (B) hereof for any period
following the Termination Date, and in such event Executive shall be obligated
to repay to the Company any amounts previously received pursuant to clause (A)
or (B) hereof, to the extent the same relate to any period following the
Termination Date.
F. Constructive Termination. Notwithstanding anything contained in
this Agreement to the contrary, in the event of a Constructive Termination (as
defined in Section 7.D below), the Company shall be deemed to have terminated
Executive involuntarily and without Business Reasons.
G. Exclusivity. The provisions of this Section 6 are intended to be
and are exclusive and in lieu of any other rights or remedies to which Executive
or the Company may otherwise be entitled, either at law, tort or contract, in
equity, or under this Agreement, in the event of any termination of Executive's
employment. Executive shall be entitled to no benefits, compensation or other
payments or rights upon termination of employment other than those benefits
expressly set forth in paragraphs A, B, C, D or E of this Section 6, whichever
shall be applicable.
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7. Definition of Terms. The following terms referred to in this Agreement
shall have the following meanings:
A. Business Reasons. "Business Reasons" shall mean (i) any act of
personal dishonesty taken by Executive in connection with his responsibilities
as an employee and intended to result in substantial personal enrichment of
Executive, (ii) commission of a felony or other offense which involves moral
turpitude or is otherwise injurious to the Company, (iii) a willful act by
Executive which constitutes gross misconduct and which is injurious to the
Company, (iv) material breach of this Agreement by Executive, including (A) any
material breach of the provisions of Sections 8, 9 or 10 hereof, or (B)
continued violation by Executive of Executive's obligations under Section 1 of
this Agreement that are demonstrably willful and deliberate on Executive's part
after there has been delivered to Executive a written demand for performance
from the Company which describes the basis for the Company's belief that
Executive has not substantially performed his duties.
B. Disability. "Disability" shall mean that Executive has been unable
to perform his duties as an employee as the result of Executive's incapacity due
to physical or mental illness, and such inability, at least 26 weeks after its
commencement, is determined to be total and permanent by a physician selected by
the Company or its insurers and acceptable to Executive or Executive's legal
representative (such Agreement as to acceptability not to be unreasonably
withheld). In the event that Executive resumes the performance of substantially
all of his duties hereunder before the termination of his employment becomes
effective, the notice of intent to terminate shall automatically be deemed to
have been revoked.
C. Termination Date. "Termination Date" shall mean (i) if this
Agreement is terminated on account of death, the date of death; (ii) if this
Agreement is terminated for Disability, sixty (60) days after the Company
provides notice to Executive of the determination that a Disability exists;
(iii) if this Agreement is otherwise terminated by the Company, the termination
date specified in the notice of termination given by the Company to Executive;
(iv) if the Agreement is terminated by Executive, the termination date specified
in the notice of termination given by Executive to the Company; or (v) if this
Agreement expires by its terms, then the last day of the term of this Agreement.
D. Constructive Termination. A "Constructive Termination" shall be
deemed to occur if (i) without the consent of Executive, (A) there is a
significant reduction in Executive's duties, authorities and responsibilities or
(B) Executive is required to relocate his place of employment, other than a
relocation within fifty (50) miles of Executive's current business location, or
(C) there is a reduction of more than 10% of Executive's Base Salary or target
bonus percentage and (ii) within the thirty (30) day period immediately
following any such change or reduction, Executive elects to terminate his
employment voluntarily.
E. Change in Control. A "Change in Control" shall be deemed to have
occurred if:
(i) For so long as any Control Shareholder or any of its
affiliates shall remain the "Beneficial Owner" (as defined in Rule 13d-3
of the Securities Exchange Act of
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1934, as amended (the "Exchange Act")), of securities of the Company that
represent 20% or more of the total voting power represented by the
Company's then outstanding voting securities, a "Change in Control" shall
be deemed to have occurred if:
(a) Any "Person" (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act, but excluding the Control
Shareholder or any of its affiliates other than an Excluded
Affiliate) becomes the Beneficial Owner, directly or indirectly,
of securities of the Company representing 50% or more of the total
voting power represented by the Company's then outstanding voting
securities;
(b) The consummation of the sale or disposition by the
Company of all or substantially all of the Company's assets;
(c) The consummation of a merger or consolidation of the
Company with any other corporation, other than a merger or
consolidation (A) which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or its parent) at
least 70% of the total voting power represented by the voting
securities of the Company or such surviving entity or its parent
outstanding immediately after such merger or consolidation or (B)
in which Control Shareholder or any of its affiliates would
continue to be the Beneficial Owner of securities representing at
least 20% of the total voting power represented by the voting
securities of the Company or such surviving entity or its parent
outstanding immediately after such merger or consolidation and no
other Person would be the Beneficial Owner of securities that
represent 20% or more of the total voting power represented by the
voting securities of the Company or such surviving entity or its
parent outstanding immediately after such merger or consolidation;
(d) Notwithstanding the provisions of paragraph (c) above,
the consummation of a merger or consolidation of the Company with
an Excluded Affiliate or any entity in which an Excluded Affiliate
beneficially owns, directly or indirectly, 50% or more of the
total voting power of the outstanding securities or the equity
interests; or
(e) The Board adopts a resolution to the effect that, for
purposes of this Agreement, a Change in Control has occurred.
(ii) At any time on or after the date Control Shareholder or any
of its affiliates no longer is the Beneficial Owner of securities of the
Company that represent 20% or more of the total voting power represented
by the Company's then outstanding voting securities, a Change in Control
shall be deemed to have occurred if:
(a) any "Person," (as such term is used for purposes of
Section 13(d) or 14(d) of the Exchange Act) (other than (A) the
Company, (B) any trustee or other fiduciary holding securities
under an employee benefit plan of the
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Company, or (C) any company owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions
as their ownership of stock of the Company), becomes the
Beneficial Owner (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company
representing 25% or more of the combined voting power of the
Company's then outstanding securities;
(b) during any period of twenty-four (24) months (not
including any period prior to the execution of this Agreement),
individuals who at the beginning of such period constitute the
Board, and any new director whose election by the Board or
nomination for election by the Company's stockholders was approved
in advance by a vote of at least two-thirds of the directors then
still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously
so approved (other than (A) a director nominated by a Person who
has entered into an agreement with the Company to effect a
transaction described in Sections 7.E(ii)(a), (c) or (d) hereof,
(B) a director nominated by any Person who publicly announces an
intention to take or to consider taking actions (including, but
not limited to, an actual or threatened proxy contest) which if
consummated would constitute a Change in Control or (C) a director
nominated by any Person who is the Beneficial Owner, directly or
indirectly, of securities of the Company representing 10% or more
of the combined voting power of the Company's securities other
than a Control Shareholder) cease for any reason to constitute at
least a majority thereof;
(c) the stockholders of the Company approve any transaction
or series of transactions under which the Company is merged or
consolidated with any other company, other than a merger or
consolidation (A) which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than 70% of
the combined voting power of the voting securities of the Company
or such surviving entity outstanding immediately after such merger
or consolidation and (B) after which no Person holds 20% or more
of the combined voting power of the then outstanding securities of
the Company or such surviving entity;
(d) the stockholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale
or disposition by the Company of all or substantially all of the
Company's assets; or
(e) the Board adopts a resolution to the effect that, for
purposes of this Agreement, a Change in Control has occurred.
Notwithstanding the foregoing provisions of (i) and (ii) above, the
offer and sale of up to approximately $125 million of preferred stock
by the Company in a private placement shall not constitute a Change in
Control for purposes of this Agreement.
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C. Control Shareholder. "Control Shareholder" shall mean any Person,
as such term is used for purposes of Section 13(d) or 14(d) of the Exchange Act,
that, as of the date of this Agreement, is the Beneficial Owner directly or
indirectly of securities of the Company representing 25% or more of the combined
voting power of the Company's outstanding securities, and any affiliates
thereof.
D. Excluded Affiliate. "Excluded Affiliate" means any affiliate of the
Control Shareholder on the date of this Agreement which on the date of this
Agreement was filing reports with the Securities and Exchange Commission
pursuant to Sections 13 or 15(d) of the Exchange Act.
8. Non-Disclosure of Confidential Information; Non-Solicitation.
A. Executive acknowledges that during the course of his employment and
performance of this Agreement, he has obtained or will obtain the Confidential
Information (as defined in paragraph F below) relating to the business of the
Company and its subsidiaries. Executive acknowledges that the Confidential
Information is a valuable asset of the Company and its subsidiaries which could
be used by Executive on behalf of a competitor of the Company to the substantial
detriment of the Company. Executive also acknowledges that during the course of
his employment and performance of this Agreement, Executive will develop
important relationships with customers and employees of the Company. Executive
acknowledges and agrees that the restrictive covenants contained in this Section
8 are reasonable and necessary to protect the legitimate business interests and
goodwill of the Company.
B. Executive agrees that he will protect the Confidential Information
and will not disclose or use at any time, except in the performance of his
duties pursuant to this Agreement, any Confidential Information without the
written consent of the Board. Executive agrees to deliver to the Company at the
end of the Employment Term, or at any other time that the Company may request,
all memoranda, notes, plans, records, documentation and other materials (and
copies thereof) containing Confidential Information relating to the business of
the Company and its subsidiaries, no matter where such material is located and
not matter what form the material may be in, which Executive may then possess or
have under his control. If requested by the Company, Executive shall provide to
the Company written confirmation that all such materials have been delivered to
the Company or have been destroyed. Executive shall take all appropriate steps
to safeguard Confidential Information and to protect it against disclosure,
misuse, espionage, loss and theft. Notwithstanding the foregoing, Executive may
make such disclosures as may be required by a valid order or subpoena issued by
a court or administrative agency of competent jurisdiction, provided that
Executive shall promptly notify the Company of any such subpoena to provide the
Company an opportunity to protect its interests.
C. For a period commencing on the date hereof and continuing for the
greater of (i) 6 months following the Termination Date or (ii) any Severance
Period, Executive shall not (a) induce or attempt to induce any employee of the
Company or any subsidiary to leave the employ of the Company or such subsidiary,
or in any way interfere with the relationship between the Company or any
subsidiary and any employee thereof, (b) hire directly or through another entity
any person who was an employee of the Company or any subsidiary at any time
during the
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Employment Term, (c) induce or attempt to induce any customer, supplier,
licensee or other business relation of the Company or any subsidiary to cease
doing business with the Company or such subsidiary, or in any way interfere with
the relationship between any such customer, supplier, licensee or business
relation and the Company or any subsidiary, or in any way interfere with the
relationship between any such customer, supplier, licensee or business relation
and the Company or any subsidiary, or (d) directly or indirectly, as an
employee, officer, director, consultant or otherwise, provide services to any of
@home, Roadrunner, Earthlink, Juno, or any division of a company, which
division's primary business is the provision of high speed internet connectivity
through residential cable modems, or any successor to any of the foregoing
(unless such entity shall have acquired the Company pursuant to a Change in
Control transaction, in which case the provisions of this subsection (d) shall
not apply with respect to such entity).
D. Executive agrees that these restrictions on competition and
solicitation shall be deemed to be a series of separate covenants not-to-compete
and a series of separate non-solicitation covenants for each month within the
specified periods any separate covenants not-to-compete and non-solicitation
covenants for each state within the United States and each country in the world.
If any court of competent jurisdiction shall determine any of the foregoing
covenants to be unenforceable with respect to the term thereof or the scope of
the subject matter or geography covered thereby, such remaining covenants shall
nonetheless be enforceable by such court against such other party or parties or
upon such shorter term or within such lesser scope as may be determined by the
court to be enforceable.
E. Because Executive's services are unique and because Executive has
access to Confidential Information and strategic plans of the Company of the
most valuable nature, the parties agree that the covenants contained in this
Section 8 are necessary to protect the value of the business of the Company and
that a breach of any such covenant would result in irreparable and continuing
damage for which there would be no adequate remedy at law. The parties agree
therefore that in the event of a breach or threatened breach of this Agreement,
the Company or its successors or assigns may, in addition to other rights and
remedies existing in their favor, apply to any court of competent jurisdiction
for specific performance or injunctive or other relief in order to enforce, or
prevent any violations of, the provisions hereof. The existence of any claim or
cause of action by Executive against the Company, whether predicated on this
Agreement or otherwise, shall not constitute a defense to the enforcement of the
provisions of this Section 8.
F. "Confidential Information" shall mean information which is not
generally known to the public and which is used, developed, or obtained by the
Company or its subsidiaries relating to the businesses of any of the Company and
its subsidiaries or the business of any customer thereof including, but not
limited to: products or services; fees, costs and pricing structure; designs;
analyses; formulae; drawings; photographs; reports; computer software, including
operating systems, applications, program listings, flow charts, manuals and
documentation; databases; accounting and business methods; inventions and new
developments and methods, whether patentable or unpatentable and whether or not
reduced to practice; all copyrightable works; the customers of any of the
Company and its subsidiaries and the Confidential Information of any customer
thereof; and all similar and related information in whatever form. Confidential
Information shall not include any information which (i) was rightfully known by
Executive prior to the Employment Term; (ii) is publicly disclosed by law or in
response
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to an order of a court or governmental agency; (iii) becomes publicly available
through no fault of Executive or (iv) has been published in a form generally
available to the public prior to the date upon which Executive proposes to
disclose such information. Information shall not be deemed to have been
published merely because individual portions of the information have been
separately published, but only if all the material features comprising such
information have been published in combination.
9. Inventions and Patents. In the event that Executive, as a part of
Executive's activities on behalf of the Company, generates, authors or
contributes to any invention, new development or method, whether or not
patentable and whether or not reduced to practice, any copyrightable work, any
trade secret, any other Confidential Information, or any information that gives
any of the Company and its subsidiaries an advantage over any competitor, or
similar or related developments or information related to the present or future
business of any of the Company and its subsidiaries (collectively "Developments
and Information"), Executive acknowledges that all Developments and Information
are the exclusive property of the Company. Executive hereby assigns to the
Company, its nominees, successors or assigns, all rights, title and interest to
Developments and Information. Executive shall cooperate with the Board to
protect the interests of the Company and its subsidiaries in Developments and
Information. Executive shall execute and file any document related to any
Developments and Information requested by the Board including applications,
powers of attorney, assignments or other instruments which the Board deems
necessary to apply for any patent, copyright or other proprietary right in any
and all countries or to convey any right, title or interest therein to any of
the Company's nominees, successors or assigns.
10. No Conflicts. Executive agrees that in his individual capacity he
will not enter into any agreement, arrangement or understanding, whether written
or oral, with any supplier, contractor, distributor, wholesaler, sales
representative, representative group or customer, relating to the business of
the Company or any of its subsidiaries, without the express written consent of
the Board.
11. Miscellaneous Provisions.
A. Notice. Notices and all other communications contemplated by this
Agreement shall be in writing, shall be effective when given, and in any event
shall be deemed to have been duly given (i) when delivered, if personally
delivered, (ii) three business days after deposit in the U.S. mail, if mailed by
U.S. registered or certified mail, return receipt requested, or (iii) one
business day after the business day of deposit with Federal Express or similar
overnight courier, if so delivered, freight prepaid. In the case of Executive,
notices shall be addressed to him at the home address which he most recently
communicated to the Company in writing. In the case of the Company, notices
shall be addressed to its corporate headquarters, and all notices shall be
directed to the attention of its General Counsel.
B. Notice of Termination. Any termination by the Company or Executive
shall be communicated by a notice of termination to the other party hereto given
in accordance with paragraph A hereof. Such notice shall indicate the specific
termination provision in this Agreement relied upon.
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C. Successors.
(i) Company's Successors. Any successor to the Company (whether
direct or indirect and whether by purchase, lease, merger, consolidation,
liquidation or otherwise) to all or substantially all of the Company's
business and/or assets shall be entitled to assume the rights and shall
be obligated to assume the obligations of the Company under this
Agreement and shall agree to perform the Company's obligations under this
Agreement in the same manner and to the same extent as the Company would
be required to perform such obligations in the absence of a succession.
For all purposes under this Agreement, the term "Company" shall include
any successor to the Company's business and/or assets which executes and
delivers the assumption agreement described in this subsection (i) or
which becomes bound by the terms of this Agreement by operation of law.
(ii) Executive's Successors. The terms of this Agreement and all
rights of Executive hereunder shall inure to the benefit of, and be
enforceable by, Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
D. No Other Assignment of Benefits. Except as provided in this Section
11.D, the rights of any person to payments or benefits under this Agreement
shall not be made subject to option or assignment, either by voluntary or
involuntary assignment or by operation of law, including (without limitation)
bankruptcy, garnishment, attachment or other creditor's process, and any action
in violation of this Section 11.D shall be void.
E. Waiver. No provision of this Agreement shall be modified, waived or
discharged unless the modification, waiver or discharge is agreed to in writing
and signed by Executive and by an authorized officer of the Company (other than
Executive). No waiver by either party of any breach of, or of compliance with,
any condition or provision of this Agreement by the other party shall be
considered a waiver of any other condition or provision or of the same condition
or provision at another time.
F. Entire Agreement. Executive acknowledges and reaffirms his
obligations contained in the Company's standard form of Proprietary Information
Agreement, which was previously executed by Executive (or, if Executive has not
previously executed such agreement, by which Executive hereby agrees to be bound
in consideration for the mutual agreements herein), which includes, without
limitation, obligations regarding confidential information, noncompetition and
non-solicitation. If there is any conflict between the terms of this Agreement
and the Proprietary Information Agreement, the terms of the more restrictive
provisions shall control. This Agreement and the Proprietary Information
Agreement collectively contain the entire understanding of the parties with
respect to the subject matter hereof and supersede any prior understandings or
agreements between the parties with respect to such subject matter.
G. Severability. The invalidity or unenforceability of any provision
or provisions of this Agreement shall not affect the validity or enforceability
of any other provision hereof, which shall remain in full force and effect.
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H. Governing Law; Arbitration. This Agreement shall be construed in
accordance with and governed by the laws of the State of Colorado as they apply
to contracts entered into and wholly to be performed within such state by
residents of such state. Except as set forth in Section 8.E of this Agreement,
any dispute or controversy arising under or in connection with this Agreement,
including, without limitation, any claim that Executive has been discriminated
against in violation of Title VII of the Civil Rights Act of 1964, the Civil
Rights Act of 1866, Civil Rights Act of 1991, the Age Discrimination in
Employment Act, the Americans with Disabilities Act, the Employees Retirement
Income Security Act of 1974, the Family and Medical Leave Act or any other
federal or state law, whether statutory or common law, shall be settled
exclusively by arbitration in Denver, Colorado, in accordance with the rules of
the American Arbitration Association then in effect. Judgment may be entered on
the arbitrator's award in any court having jurisdiction. No party shall be
entitled to seek or be awarded punitive damages. All attorneys' fees and costs
shall be allocated or apportioned by the parties, and in the absence of any
agreement or allocation or apportionment shall be awarded to the prevailing
party.
I. Employment Taxes. All payments made pursuant to this Agreement will
be subject to withholding of applicable taxes.
J. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together will constitute
one and the same instrument.
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its duly authorized officer, as of the day and year
first above written.
HIGH SPEED ACCESS CORP.
By:
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Xxxxxx X. X'Xxxxx
Title: Chief Executive Officer/President
EXECUTIVE
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XXXXXXX X. XXXXXXXXXX, III
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