Exhibit 10.13
STORAGENETWORKS, INC.
Executive Retention Agreement
THIS EXECUTIVE RETENTION AGREEMENT by and between StorageNetworks, Inc.,
a Delaware corporation (the "Company"), and _____________ (the "Executive") is
made as of March 5, 2003 (the "Effective Date").
WHEREAS, the Company recognizes that, as is the case with many
publicly-held corporations, the possibility of a change in control of the
Company exists and that such possibility, and the uncertainty and questions
which it may raise among key personnel, may result in the departure or
distraction of key personnel to the detriment of the Company and its
stockholders, and
WHEREAS, the Board of Directors of the Company (the "Board") has
determined that appropriate steps should be taken to reinforce and encourage the
continued employment and dedication of the Company's key personnel without
distraction from the possibility of a change in control of the Company and
related events and circumstances.
NOW, THEREFORE, as an inducement for and in consideration of the
Executive remaining in its employ, the Company agrees that the Executive shall
receive the severance benefits set forth in this Agreement in the event the
Executive's employment with the Company is terminated under the circumstances
described below subsequent to a Change in Control (as defined in Section 1.1).
1. Key Definitions.
As used herein, the following terms shall have the following respective
meanings:
1.1 "Change in Control" means an event or occurrence set forth
in any one or more of subsections (a) through (d) below (including an event or
occurrence that constitutes a Change in Control under one of such subsections
but is specifically exempted from another such subsection):
(a) the acquisition by an individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial
ownership of any capital stock of the Company if, after such acquisition, such
Person beneficially owns (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) 50% or more of either (x) the then-outstanding shares of common
stock of the Company (the "Outstanding Company Common Stock") or (y) the
combined voting power of the then-outstanding securities of the Company entitled
to vote generally in the election of directors (the "Outstanding Company Voting
Securities"); provided, however, that for purposes of this subsection (a), the
following acquisitions shall not constitute a Change in Control: (i) any
acquisition directly from the Company (excluding an acquisition pursuant to the
exercise, conversion or exchange of any security exercisable for, convertible
into or exchangeable for common stock or voting securities of the Company,
unless the Person exercising, converting or exchanging such security acquired
such security directly from the Company or an underwriter or agent of the
Company), (ii) any acquisition by the Company, (iii) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company, or (iv) any acquisition by any
corporation pursuant to a transaction which complies with clauses (i) and (ii)
of subsection (c) of this Section 1.1; or
(b) such time as the Continuing Directors (as defined
below) do not constitute a majority of the Board (or, if applicable, the Board
of Directors of a successor corporation to the Company), where the term
"Continuing Director" means at any date a member of the Board (i) who was a
member of the Board on the date of the execution of this Agreement or (ii) who
was nominated or elected subsequent to such date by at least a majority of the
directors who were Continuing Directors at the time of such nomination or
election or whose election to the Board was recommended or endorsed by at least
a majority of the directors who were Continuing Directors at the time of such
nomination or election; provided, however, that there shall be excluded from
this clause (ii) any individual whose initial assumption of office occurred as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents, by or on behalf of a person other than the Board; or
(c) the consummation of a merger, consolidation,
reorganization, recapitalization or statutory share exchange involving the
Company or a sale or other disposition of all or substantially all of the assets
of the Company in one or a series of transactions (a "Business Combination").
Solely for the purposes of Section 4.1 only, such a transaction shall not be
considered a Change of Control if immediately following such Business
Combination, each of the following two conditions is satisfied: (i) all or
substantially all of the individuals and entities who were the beneficial owners
of the Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such Business Combination beneficially own,
directly or indirectly, more than 50% of the then-outstanding shares of common
stock and the combined voting power of the then-outstanding securities entitled
to vote generally in the election of directors, respectively, of the resulting
or acquiring corporation in such Business Combination (which shall include,
without limitation, a corporation which as a result of such transaction owns the
Company or substantially all of the Company's assets either directly or through
one or more subsidiaries) (such resulting or acquiring corporation is referred
to herein as the "Acquiring Corporation") in substantially the same proportions
as their ownership, immediately prior to such Business Combination, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities,
respectively; and (ii) no Person (excluding the Acquiring Corporation or any
employee benefit plan (or related trust) maintained or sponsored by the Company
or by the Acquiring Corporation) beneficially owns, directly or indirectly, 50%
or more of the then outstanding shares of common stock of the Acquiring
Corporation, or of the combined voting power of the then-outstanding securities
of such corporation entitled to vote generally in the election of
directors (except to the extent that such ownership existed prior to the
Business Combination); or
(d) approval by the stockholders of the Company of a
complete liquidation or dissolution of the Company.
1.2 "Change in Control Date" means the first date during the
Term (as defined in Section 2) on which a Change in Control occurs. Anything in
this Agreement to the contrary notwithstanding, if (a) a Change in Control
occurs, (b) the Executive's employment with the Company is terminated prior to
the date on which the Change in Control occurs, and (c) it is reasonably
demonstrated by the Executive that such termination of employment (i) was at the
request of a third party who has taken steps reasonably calculated to effect a
Change in Control or (ii) otherwise arose in connection with or in anticipation
of a Change in Control, then for all purposes of this Agreement the "Change in
Control Date" shall mean the date immediately prior to the date of such
termination of employment.
1.3 "Cause" means:
(a) the Executive's willful and continued failure to
substantially perform his reasonable assigned duties (other than any such
failure resulting from incapacity due to physical or mental illness or any
failure after the Executive gives notice of termination for Good Reason), which
failure is not cured within 30 days after a written demand for substantial
performance is received by the Executive from the Board of Directors of the
Company which specifically identifies the manner in which the Board of Directors
believes the Executive has not substantially performed the Executive's duties;
or
(b) the Executive's willful engagement in illegal
conduct or gross misconduct which is materially and demonstrably injurious to
the Company.
For purposes of this Section 1.3, no act or failure to act by the
Executive shall be considered "willful" unless it is done, or omitted to be
done, in bad faith and without reasonable belief that the Executive's action or
omission was in the best interests of the Company.
1.4 "Good Reason" means the occurrence, without the Executive's
written consent, of any of the events or circumstances set forth in clauses (a)
through (g) below. Notwithstanding the occurrence of any such event or
circumstance, such occurrence shall not be deemed to constitute Good Reason if,
prior to the Date of Termination specified in the Notice of Termination (each as
defined in Section 3.2(a)) given by the Executive in respect thereof, such event
or circumstance has been fully corrected and the Executive has been reasonably
compensated for any losses or damages resulting therefrom (provided that such
right of correction by the Company shall only apply to the first Notice of
Termination for Good Reason given by the Executive).
(a) the assignment to the Executive of duties
inconsistent in any material respect with the Executive's position (including
status, offices, titles and
reporting requirements), authority or responsibilities in effect immediately
prior to the earliest to occur of (i) the Change in Control Date, (ii) the date
of the execution by the Company of the initial written agreement or instrument
providing for the Change in Control or (iii) the date of the adoption by the
Board of Directors of a resolution providing for the Change in Control (with the
earliest to occur of such dates referred to herein as the "Measurement Date"),
or any other action or omission by the Company which results in a material
diminution in such position, authority or responsibilities;
(b) a reduction in the Executive's annual base salary as
in effect on the Measurement Date or as the same was or may be increased
thereafter from time to time;
(c) the failure by the Company to (i) continue in effect
any material compensation or benefit plan or program (including without
limitation any life insurance, medical, health and accident or disability plan
and any vacation or automobile program or policy) (a "Benefit Plan") in which
the Executive participates or which is applicable to the Executive immediately
prior to the Measurement Date, unless an equitable arrangement (embodied in an
ongoing substitute or alternative plan) has been made with respect to such plan
or program, (ii) continue the Executive's participation therein (or in such
substitute or alternative plan) on a basis not materially less favorable, both
in terms of the amount of benefits provided and the level of the Executive's
participation relative to other participants, than the basis existing
immediately prior to the Measurement Date or (iii) award cash bonuses to the
Executive in amounts and in a manner substantially consistent with past practice
in light of the Company's financial performance;
(d) a change by the Company in the location at which the
Executive performs his principal duties for the Company to a new location that
is both (i) outside a radius of 45 miles from the Executive's principal
residence immediately prior to the Measurement Date and (ii) more than 20 miles
from the location at which the Executive performed his principal duties for the
Company immediately prior to the Measurement Date; or a requirement by the
Company that the Executive travel on Company business to a substantially greater
extent than required immediately prior to the Measurement Date;
(e) the failure of the Company to obtain the agreement
from any successor to the Company to assume and agree to perform this Agreement,
as required by Section 6.1;
(f) a purported termination of the Executive's
employment which is not effected pursuant to a Notice of Termination satisfying
the requirements of Section 3.2(a); or
(g) any failure of the Company to pay or provide to the
Executive any portion of the Executive's compensation or benefits due under any
Benefit Plan within seven days of the date such compensation or benefits are
due, or any material
breach by the Company of this Agreement or any employment agreement with the
Executive.
For purposes of this Agreement, any good faith determination of "Good
Reason" made by the Executive shall be conclusive, binding and final. The
Executive's right to terminate his employment for Good Reason shall not be
affected by his incapacity due to physical or mental illness.
1.5 "Disability" means the Executive's absence from the
full-time performance of the Executive's duties with the Company for 180
consecutive calendar days as a result of incapacity due to mental or physical
illness which is determined to be total and permanent by a physician selected by
the Company or its insurers and acceptable to the Executive or the Executive's
legal representative.
2. Term of Agreement. This Agreement, and all rights and obligations of
the parties hereunder, shall take effect upon the Effective Date and shall
expire upon the first to occur of (a) the expiration of the Term (as defined
below) if a Change in Control has not occurred during the Term, (b) the
termination of the Executive's employment with the Company prior to the Change
in Control Date, (c) the date 24 months after the Change in Control Date, if the
Executive is still employed by the Company as of such later date, or (d) the
fulfillment by the Company of all of its obligations under Sections 4 and 5.2
and 5.3 if the Executive's employment with the Company terminates within 24
months following the Change in Control Date. "Term" shall mean the period
commencing as of the Effective Date and continuing in effect through December
31, 2007; provided, however, that commencing on January 1, 2008 and each January
1 thereafter, the Term shall be automatically extended for one additional year
unless, not later than 90 days prior to the scheduled expiration of the Term (or
any extension thereof), the Company shall have given the Executive written
notice that the Term will not be extended.
3. Employment Status; Termination Following Change in Control.
3.1 Not an Employment Contract. The Executive acknowledges that
this Agreement does not constitute a contract of employment or impose on the
Company any obligation to retain the Executive as an employee and that this
Agreement does not prevent the Executive from terminating employment at any
time. If the Executive's employment with the Company terminates for any reason
and subsequently a Change in Control shall occur, the Executive shall not be
entitled to any benefits hereunder except as otherwise provided pursuant to
Section 1.2.
3.2 Termination of Employment.
(a) If the Change in Control Date occurs during the
Term, any termination of the Executive's employment by the Company or by the
Executive within 24 months following the Change in Control Date (other than due
to the death of the Executive) shall be communicated by a written notice to the
other party hereto (the "Notice of Termination"), given in accordance with
Section 7. Any Notice of
Termination shall: (i) indicate the specific termination provision (if any) of
this Agreement relied upon by the party giving such notice, (ii) to the extent
applicable, set forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of the Executive's employment under the
provision so indicated and (iii) specify the Date of Termination (as defined
below). The effective date of an employment termination (the "Date of
Termination") shall be the close of business on the date specified in the Notice
of Termination (which date may not be less than 15 days or more than 120 days
after the date of delivery of such Notice of Termination), in the case of a
termination other than one due to the Executive's death, or the date of the
Executive's death, as the case may be. In the event the Company fails to satisfy
the requirements of Section 3.2(a) regarding a Notice of Termination, the
purported termination of the Executive's employment pursuant to such Notice of
Termination shall not be effective for purposes of this Agreement.
(b) The failure by the Executive or the Company to set
forth in the Notice of Termination any fact or circumstance which contributes to
a showing of Good Reason or Cause shall not waive any right of the Executive or
the Company, respectively, hereunder or preclude the Executive or the Company,
respectively, from asserting any such fact or circumstance in enforcing the
Executive's or the Company's rights hereunder.
(c) Any Notice of Termination for Cause given by the
Company must be given within 90 days of the occurrence of the event(s) or
circumstance(s) which constitute(s) Cause. Prior to any Notice of Termination
for Cause being given (and prior to any termination for Cause being effective),
the Executive shall be entitled to a hearing before the Board of Directors of
the Company at which he may, at his election, be represented by counsel and at
which he shall have a reasonable opportunity to be heard. Such hearing shall be
held on not less than 15 days prior written notice to the Executive stating the
Board of Directors' intention to terminate the Executive for Cause and stating
in detail the particular event(s) or circumstance(s) which the Board of
Directors believes constitutes Cause for termination.
4. Benefits to Executive.
4.1 Stock Acceleration. If the Change in Control Date
occurs during the Term, then, effective fifteen days prior to the Change in
Control Date (a) each outstanding option to purchase shares of Common Stock of
the Company held by the Executive shall become immediately exercisable in full
and shares of Common Stock of the Company received upon exercise of any options
will no longer be subject to a right of repurchase by the Company, (b) each
outstanding restricted stock award shall be deemed to be fully vested and will
no longer be subject to a right of repurchase by the Company and (c)
notwithstanding any provision in any applicable option agreement to the
contrary, each such option shall continue to be exercisable by the Executive (to
the extent such option was exercisable on the Date of Termination) for a period
of twelve months following the Date of Termination.
4.2 Compensation. If the Change in Control Date occurs during
the Term and the Executive's employment with the Company terminates within 24
months following the Change in Control Date, the Executive shall be entitled to
the following benefits:
(a) Termination Without Cause or for Good Reason. If the
Executive's employment with the Company is terminated by the Company (other than
for Cause, Disability or Death) or by the Executive for Good Reason within 24
months following the Change in Control Date, then the Executive shall be
entitled to the following benefits:
(i) the Company shall pay to the Executive the
following amounts:
(1) in cash within 30 days after the Date
of Termination the aggregate of the lump sum of (A) the Executive's base salary
through the Date of Termination, (B) the product of (x) the annual bonus paid or
payable (including any bonus or portion thereof which has been earned but
deferred) for the most recently completed fiscal year and (y) a fraction, the
numerator of which is the number of days in the current fiscal year through the
Date of Termination, and the denominator of which is 365 and (C) the amount of
any compensation previously deferred by the Executive (together with any accrued
interest or earnings thereon) and any accrued vacation pay, in each case to the
extent not previously paid (the sum of the amounts described in clauses (A),
(B), and (C) shall be hereinafter referred to as the "Accrued Obligations");
(2) in a lump sum in cash within 30 days
after the Date of Termination an amount equal to the Executive's highest annual
bonus during the five-year period prior to the Change in Control Date; and
(3) an amount equal to the Executive's
highest annual base salary during the five-year period prior to the Date of
Termination. The payment of such amount shall, at the Company's option, be paid
either (x) in a lump sum in cash within 30 days after the Date of Termination or
(y) in equal installments during the 12 month period following the Date of
Termination in accordance with the Company's then current payroll practices (as
such practices may be amended from time to time).
(ii) for 12 months after the Date of Termination,
or such longer period as may be provided by the terms of the appropriate plan,
program, practice or policy, the Company shall continue to provide benefits to
the Executive and the Executive's family at least equal to those which would
have been provided to them if the Executive's employment had not been
terminated, in accordance with the applicable Benefit Plans in effect on the
Measurement Date or, if more favorable to the Executive and his family, in
effect generally at any time thereafter with respect to other peer executives of
the Company and its affiliated companies; provided, however, that if the
Executive becomes reemployed with another employer and is eligible to receive a
particular type of benefits (e.g., health insurance benefits) from such employer
on terms
at least as favorable to the Executive and his family as those being provided by
the Company, then the Company shall no longer be required to provide those
particular benefits to the Executive and his family;
(iii) to the extent not previously paid or
provided, the Company shall timely pay or provide to the Executive any other
amounts or benefits required to be paid or provided or which the Executive is
eligible to receive following the Executive's termination of employment under
any plan, program, policy, practice, contract or agreement of the Company and
its affiliated companies (such other amounts and benefits shall be hereinafter
referred to as the "Other Benefits");
(iv) for purposes of determining eligibility (but
not the time of commencement of benefits) of the Executive for retiree benefits
to which the Executive is entitled, the Executive shall be considered to have
remained employed by the Company until 12 months after the Date of Termination;
and
(v) to the extent not previously accelerated or
vested pursuant to Section 4.1 or otherwise, (a) each outstanding option to
purchase shares of Common Stock of the Company held by the Executive shall
become immediately exercisable in full and shares of Common Stock of the Company
received upon exercise of any options will no longer be subject to a right of
repurchase by the Company, (b) each outstanding restricted stock award shall be
deemed to be fully vested and will no longer be subject to a right of repurchase
by the Company and (c) notwithstanding any provision in any applicable option
agreement to the contrary, each such option shall continue to be exercisable by
the Executive (to the extent such option was exercisable on the Date of
Termination) for a period of twelve months following the Date of Termination.
(b) Resignation without Good Reason; Termination for
Death or Disability. If the Executive voluntarily terminates his employment with
the Company following the Change in Control Date, excluding a termination for
Good Reason, or if the Executive's employment with the Company is terminated by
reason of the Executive's death or Disability following the Change in Control
Date, then the Company shall (i) pay the Executive (or his estate, if
applicable), in a lump sum in cash within 30 days after the Date of Termination,
the Accrued Obligations and (ii) timely pay or provide to the Executive the
Other Benefits.
(c) Termination for Cause. If the Company terminates the
Executive's employment with the Company for Cause following the Change in
Control Date, then the Company shall (i) pay the Executive, in a lump sum in
cash within 30 days after the Date of Termination, the sum of (A) the
Executive's annual base salary through the Date of Termination and (B) the
amount of any compensation previously deferred by the Executive, in each case to
the extent not previously paid, and (ii) timely pay or provide to the Executive
the Other Benefits.
4.3 Taxes.
(a) In the event that the Company undergoes a "Change in
Ownership or Control" (as defined below), the Company shall, within 30 days
after each date on which the Executive becomes entitled to receive (whether or
not then due) a Contingent Compensation Payment (as defined below) relating to
such Change in Ownership or Control, determine and notify the Executive (with
reasonable detail regarding the basis for its determinations) (i) which of the
payments or benefits due to the Executive (under this Agreement or otherwise)
following such Change in Ownership or Control constitute Contingent Compensation
Payments, (ii) the amount, if any, of the excise tax (the "Excise Tax") payable
pursuant to Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code"), by the Executive with respect to such Contingent Compensation Payment
and (iii) the amount of the Gross-Up Payment (as defined below) due to the
Executive with respect to such Contingent Compensation Payment. Within 30 days
after delivery of such notice to the Executive, the Executive shall deliver a
response to the Company (the "Executive Response") stating either (A) that he
agrees with the Company's determination pursuant to the preceding sentence or
(B) that he disagrees with such determination, in which case he shall indicate
which payment and/or benefits should be characterized as a Contingent
Compensation Payment, the amount of the Excise Tax with respect to such
Contingent Compensation Payment and the amount of the Gross-Up Payment due to
the Executive with respect to such Contingent Compensation Payment. The amount
and characterization of any item in the Executive Response shall be final;
provided, however, that in the event that the Executive fails to deliver an
Executive Response on or before the required date, the Company's initial
determination shall be final. Within 90 days after the due date of each
Contingent Compensation Payment to the Executive, the Company shall pay to the
Executive, in cash, the Gross-Up Payment with respect to such Contingent
Compensation Payment, in the amount determined pursuant to this Section 4.3(a).
(b) For purposes of this Section 4.3, the following terms shall
have the following respective meanings:
(i) "Change in Ownership or Control" shall mean a
change in the ownership or effective control of the Company or in the ownership
of a substantial portion of the assets of the Company determined in accordance
with Section 280G(b)(2) of the Code.
(ii) "Contingent Compensation Payment" shall mean
any payment (or benefit) in the nature of compensation that is made or made
available (under this Agreement or otherwise) to a "disqualified individual" (as
defined in Section 280G(c) of the Code) and that is contingent (within the
meaning of Section 280G(b)(2)(A)(i) of the Code) on a Change in Ownership or
Control of the Company.
(iii) "Gross-Up Payment" shall mean an amount equal
to the sum of (i) the amount of the Excise Tax payable with respect to a
Contingent Compensation Payment and (ii) the amount necessary to pay all
additional taxes imposed on (or economically borne by) the Executive (including
the Excise Taxes, state and federal income taxes and all applicable employment
taxes) attributable to the receipt of
such Gross-Up Payment. For purposes of the preceding sentence, all taxes
attributable to the receipt of the Gross-Up Payment shall be computed assuming
the application of the maximum tax rates provided by law.
(c) The provisions of this Section 4.3 are intended to
apply to any and all payments or benefits available to the Executive under this
Agreement or any other agreement or plan of the Company under which the
Executive receives Contingent Compensation Payments.
4.4 Mitigation. The Executive shall not be required to mitigate
the amount of any payment or benefits provided for in this Section 4 by seeking
other employment or otherwise. Further, except as provided in Section
4.2(a)(ii), the amount of any payment or benefits provided for in this Section 4
shall not be reduced by any compensation earned by the Executive as a result of
employment by another employer, by retirement benefits, by offset against any
amount claimed to be owed by the Executive to the Company or otherwise.
4.5 Outplacement Services. In the event the Executive is
terminated by the Company (other than for Cause, Disability or Death), or the
Executive terminates employment for Good Reason, within 24 months following the
Change in Control Date, the Company shall provide outplacement services through
one or more outside firms of the Executive's choosing up to an aggregate of
$25,000, with such services to extend until the earlier of (i) 12 months
following the termination of Executive's employment or (ii) the date the
Executive secures full time employment.
5. Disputes.
5.1 Settlement of Disputes; Arbitration. All claims by the
Executive for benefits under this Agreement shall be directed to and determined
by the Board of Directors of the Company and shall be in writing. Any denial by
the Board of Directors of a claim for benefits under this Agreement shall be
delivered to the Executive in writing and shall set forth the specific reasons
for the denial and the specific provisions of this Agreement relied upon. The
Board of Directors shall afford a reasonable opportunity to the Executive for a
review of the decision denying a claim. Any further dispute or controversy
arising under or in connection with this Agreement shall be settled exclusively
by arbitration in Boston, Massachusetts, 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.
5.2 Expenses. The Company agrees to pay as incurred, to the
full extent permitted by law, all legal, accounting and other fees and expenses
which the Executive may reasonably incur as a result of any claim or contest
(regardless of the outcome thereof) by the Company, the Executive or others
regarding the validity or enforceability of, or liability under, any provision
of this Agreement or any guarantee of performance thereof (including as a result
of any contest by the Executive regarding the amount of any payment or benefits
pursuant to this Agreement), plus in each case interest
on any delayed payment at the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Code.
5.3 Compensation During a Dispute. If the Change in Control
Date occurs during the Term and the Executive's employment with the Company
terminates within 24 months following the Change in Control Date, and the right
of the Executive to receive benefits under Section 4 (or the amount or nature of
the benefits to which he is entitled to receive) are the subject of a dispute
between the Company and the Executive, the Company shall continue (a) to pay to
the Executive his base salary in effect as of the Measurement Date and (b) to
provide benefits to the Executive and the Executive's family at least equal to
those which would have been provided to them, if the Executive's employment had
not been terminated, in accordance with the applicable Benefit Plans in effect
on the Measurement Date, until such dispute is resolved either by mutual written
agreement of the parties or by an arbitrator's award pursuant to Section 5.1.
Following the resolution of such dispute, the sum of the payments (net of tax
and other withholdings) made to the Executive under clause (a) of this Section
5.3 shall be deducted from any cash payment which the Executive is entitled to
receive pursuant to Section 4; and if such sum exceeds the amount of the cash
payment which the Executive is entitled to receive pursuant to Section 4, the
excess of such net sum over the amount of such payment shall be repaid (without
interest) by the Executive to the Company within 60 days of the resolution of
such dispute.
6. Successors.
6.1 Successor to Company. The Company shall require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business or assets of the Company
expressly to assume and agree to perform this Agreement to the same extent that
the Company would be required to perform it if no such succession had taken
place. Failure of the Company to obtain an assumption of this Agreement at or
prior to the effectiveness of any succession shall be a breach of this Agreement
and shall constitute Good Reason if the Executive elects to terminate
employment, except that for purposes of implementing the foregoing, the date on
which any such succession becomes effective shall be deemed the Date of
Termination. As used in this Agreement, "Company" shall mean the Company as
defined above and any successor to its business or assets as aforesaid which
assumes and agrees to perform this Agreement, by operation of law or otherwise.
6.2 Successor to Executive. This Agreement shall inure to the
benefit of and be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive should die while any amount would still
be payable to the Executive or his family hereunder if the Executive had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to the executors, personal
representatives or administrators of the Executive's estate.
7. Notice. All notices, instructions and other communications given
hereunder or in connection herewith shall be in writing. Any such notice,
instruction or
communication shall be sent either (i) by registered or certified mail, return
receipt requested, postage prepaid, or (ii) prepaid via a reputable nationwide
overnight courier service, in each case addressed to the Company, at 000 Xxxxx
Xxxxxx, Xxxxxxx, XX, and to the Executive at the Executive's address indicated
on the signature page of this Agreement (or to such other address as either the
Company or the Executive may have furnished to the other in writing in
accordance herewith). Any such notice, instruction or communication shall be
deemed to have been delivered five business days after it is sent by registered
or certified mail, return receipt requested, postage prepaid, or one business
day after it is sent via a reputable nationwide overnight courier service.
Either party may give any notice, instruction or other communication hereunder
using any other means, but no such notice, instruction or other communication
shall be deemed to have been duly delivered unless and until it actually is
received by the party for whom it is intended.
8. Miscellaneous.
8.1 Employment by Subsidiary. For purposes of this Agreement,
the Executive's employment with the Company shall not be deemed to have
terminated solely as a result of the Executive continuing to be employed by a
wholly-owned subsidiary of the Company.
8.2 Severability. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.
8.3 Injunctive Relief. The Company and the Executive agree that
any breach of this Agreement by the Company is likely to cause the Executive
substantial and irrevocable damage and therefore, in the event of any such
breach, in addition to such other remedies which may be available, the Executive
shall have the right to specific performance and injunctive relief.
8.4 Governing Law. The validity, interpretation, construction
and performance of this Agreement shall be governed by the internal laws of the
Commonwealth of Massachusetts, without regard to conflicts of law principles.
8.5 Waivers. No waiver by the Executive at any time of any
breach of, or compliance with, any provision of this Agreement to be performed
by the Company shall be deemed a waiver of that or any other provision at any
subsequent time.
8.6 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original but both of which
together shall constitute one and the same instrument.
8.7 Tax Withholding. Any payments provided for hereunder shall
be paid net of any applicable tax withholding required under federal, state or
local law.
8.8 Entire Agreement. This Agreement sets forth the entire
agreement of the parties hereto in respect of the subject matter contained
herein and supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or
warranties, whether oral or written, by any officer, employee or representative
of any party hereto in respect of the subject matter contained herein; and any
prior agreement of the parties hereto in respect of the subject matter contained
herein is hereby superseded by the provisions of this Agreement.
8.9 Amendments. This Agreement may be amended or modified only
by a written instrument executed by both the Company and the Executive.
8.10 Executive's Acknowledgements. The Executive acknowledges
that he: (a) has read this Agreement; (b) has been represented in the
preparation, negotiation, and execution of this Agreement by legal counsel of
the Executive's own choice or has voluntarily declined to seek such counsel; (c)
understands the terms and consequences of this Agreement; and (d) understands
that the Company's in-house and outside counsel are acting as counsel to the
Company in connection with the transactions contemplated by this Agreement, and
is not acting as counsel for the Executive.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first set forth above.
STORAGENETWORKS, INC.
By:___________________________________
Title:________________________________
______________________________________
[EXECUTIVE]
Address:
______________________________________
______________________________________
______________________________________
