Exhibit 10.108
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "AGREEMENT") is made and entered into by
and between INTERLAND, INC., a Minnesota corporation having its principal
executive offices located at the business address of 000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000 (the "COMPANY"), and Xxxxx Xxxxxxx, an
individual residing in Marietta, Georgia ("EXECUTIVE"). Company and Executive
enter into this Agreement as of the date they each have signed it, but the
Agreement shall be effective as of the date established pursuant to Section 2.1,
below.
WHEREAS, Company desires to employ Executive as the Vice President,
General Counsel and Corporate Secretary as of November 1, 2001, and whereas the
parties wish to establish certain terms and conditions of such employment by
entering into this Agreement; and
WHEREAS, Executive desires such employment with Company on the terms and
conditions set forth in this Agreement.
NOW THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, the parties hereby agree as follows:
1. Employment; Regular Compensation. Company agrees to employ Executive
as Vice President, General Counsel and Corporate Secretary, and Executive agrees
to serve Company as Vice President, General Counsel and Corporate Secretary on
the terms and conditions set forth in this Agreement. Company shall pay
Executive an initial base salary (the "BASE SALARY") as set forth in Company's
offer letter dated September 26, 2001 and attached hereto as EXHIBIT 1. The Base
Salary set forth in the offer letter is expressed as an annual amount solely for
reference purposes, and shall be payable to Executive on a bi-weekly basis. In
its sole discretion, the Company may change Executive's compensation.
2. Effective Date; Indefinite Term.
2.1 This Agreement shall be deemed in full force and effect as of
the date it is executed by the parties below, along with the execution of any
exhibits hereto;
2.2 This Agreement has an indefinite term, and Executive's
employment by Company hereunder may be terminated at will by either party at any
time, with or without Cause (as defined in Section 6.1, below) or any reason,
voluntary or involuntary, and with or without prior notice. Certain provisions
of this Agreement, however, as more fully set forth in Section 5, below, provide
for the payment of benefits to Executive upon the specified circumstances of
termination of Executive's employment with Company, and certain other
provisions, as more fully set forth below in Section 11, below, may continue in
effect beyond the date of such termination. Executive expressly acknowledges and
agrees that employment with Company is on an "at will" basis, and that this
Agreement does not provide a guarantee of continued employment, notwithstanding
any other provision in this Agreement.
1
3. Duties. Executive shall report to Xxxx Xxxxxx, Chairman and Chief
Executive Officer , or such other individual as may be designated from time to
time by Xxxx Xxxxxx or the Board of Directors (the "BOARD"). Executive shall
faithfully and diligently perform all such acts and duties, and furnish such
services, as are assigned to Executive by Xxxx Xxxxxx, Chairman and Chief
Executive Officer, or such other individual as may be designated by Xxxx Xxxxxx
or the Board.
4. Efforts; Conflicts of Interest. During Executive's employment by
Company, Executive shall devote his full business time and efforts to Company
and its business during normal business hours, and shall safeguard and promote
its lawful interests. During Executive's employment by Company, Executive shall
not, either directly or indirectly, engage in or enter into any business or
perform any services for any other person, firm, association, or corporation
that conflicts with Executive's efforts to Company or with Company's business
interests, except for: (a) serving on the board of directors of any other entity
that is not in competition with Company (subject to Company's approval, which
shall not be unreasonably withheld or delayed); (b) activities approved in
writing in advance by Xxxx Xxxxxx or the Board, which approval shall not be
unreasonably withheld or delayed; or (c) passive investments in entities that do
not involve Executive providing any advice or services to the businesses in
which the investments are made, or which do not violate Company policy,
including without limitation any policy relating to conflicts of interest or
business ethics.
5. Benefits Upon Termination of Employment.
5.1 By Company for Cause or by Executive Without Good Reason. If
Executive's employment is terminated by Company for Cause or by Executive
Without Good Reason (as defined in Section 6.5, below), then Company's
obligation to pay compensation and benefits under this Agreement shall
immediately terminate, except that: (a) Company shall pay to Executive and, if
applicable, Executive's heirs, any earned but unpaid Base Salary through such
termination date; and (b) Company shall permit Executive to receive continuation
of the benefits as set forth in Section 5.5, below, to the extent applicable.
Under such circumstances, no further payments or benefits (except as otherwise
required by law) shall be provided to Executive. The terms "Cause" and "Without
Good Reason" shall have the meaning set forth in Section 6, below.
5.2 By Company for Nonperformance Due to Disability. If
Executive's employment is terminated by Company for Nonperformance Due to
Disability, then Company's obligation to pay compensation and benefits under
this Agreement shall immediately terminate, except that: (a) Company shall pay
to Executive and, if applicable, Executive's heirs, any earned but unpaid Base
Salary through such termination date; (b) Company shall provide Executive with
such other payments and benefits as may be permitted under the Company's short-
or long-term disability plans, to the extent applicable, and subject to the
terms and conditions of such plans, including without limitation any eligibility
requirements; and (c) Company shall permit Executive to receive continuation of
the benefits as set forth in Section 5.5, below, to the extent applicable. The
term "Nonperformance Due to Disability" shall have the meaning set forth in
Section 6, below.
2
5.3 By Company Other Than for Cause or by Executive for Good
Reason. If Executive's employment is terminated by Company other than for Cause
or by Executive for Good Reason (as defined in Section 6.3, below), then
Company's obligation to pay compensation and benefits under this Agreement shall
immediately terminate, except that: (a) Company shall pay to Executive and, if
applicable, Executive's heirs, any earned but unpaid Base Salary through such
termination date; (b) Company shall pay to Executive any earned but unpaid
incentive compensation or bonuses through the termination date, subject to the
terms of the applicable bonus plan, including without limitation any eligibility
requirements or any limitations on such payment under applicable law; (c)
Company shall permit Executive to receive continuation of the benefits as set
forth in Section 5.5, below, to the extent applicable; and (d) Company shall pay
to Executive, as severance benefits, an amount equal to 6 months of Base Salary
(the "SEVERANCE BENEFITS"). The Severance Benefits shall be paid in a lump sum,
as soon as practicable following such termination date, subject to the following
conditions: (x) Executive shall execute a written, complete waiver and release
of all claims relating to Company, or Executive's employment by Company or any
termination thereof, within any applicable consideration or execution periods
and in a form that is acceptable to Company; and (y) subject to confirmation by
Company that Executive does not later revoke such waiver and release of claims
within any revocation period required by applicable law.
5.4 Death of Executive. In the event of Executive's death,
Executive's employment and all other obligations hereunder shall automatically
terminate and the Company's obligation to pay compensation and benefits under
this Agreement shall immediately terminate, except that Company shall pay to
Executive's estate: (a) Executive's Base Salary through the end of the calendar
month in which Executive's death occurs; (b) Executive's earned but unpaid
incentive compensation or bonuses through the date of Executive's death, subject
to the terms and conditions of the applicable Bonus Plan, including without
limitation any eligibility requirements or any limitations on such payment under
applicable law; and (c) Company shall permit Executive's heirs to receive
continuation of the benefits as set forth in Section 5.5, below, to the extent
applicable and allowed by law and subject to the terms of such plans.
5.5 Benefits Continuation. Upon termination of Executive's
employment, Company shall permit Executive and, if applicable, Executive's
family members, to continue to participate in Company's employee benefits plans,
to the extent required or allowed by law and subject to the terms of such plans
and applicable law.
6. Definitions.
6.1 "CAUSE" shall mean termination of Executive's employment by
Company for one or more of the following reasons: (a) Executive has breached or
threatens to breach a fiduciary duty owed to Company; (b) Executive has engaged
or threatens to engage in dishonesty, fraud, gross negligence, willful
malfeasance or other acts of misconduct in the performance of Executive's duties
or during the course of Executive's employment; (c) upon the willful and
continued failure by Executive substantially to perform Executive's duties with
the Company (other than by reason of Nonperformance Due to Disability as defined
below);
3
(d) Executive has willfully violated or threatens to violate Company policies,
or has willfully violated or threatens to violate any law, rule or regulation
(other than traffic violations or similar offenses) which result in material
injury to Company; or (e) Executive has violated or threatens to violate the
terms of Sections 4, 7, or 8 of this Agreement or the material terms of the
Confidentiality and Non-Competition Agreement, or any other material breach of
this Agreement.
6.2 "DISABILITY" shall have the meaning ascribed to such term or
its variations, such as "Disabled," in Company's long-term disability plan, or
in the absence of such plan, a meaning consistent with the definition of
permanent and total disability under Section 22(e)(3) of the Internal Revenue
Code of 1986, as amended.
6.3 "GOOD REASON" shall mean that one or more of the following
events has occurred and, after giving Company written notice of the occurrence
and of Executive's intention to resign from employment and Company not curing
the event within 30 days of receipt of such written notice: (a) a substantial
adverse change in Executive's duties or responsibilities, without Executive's
consent; (b) a reduction in Executive's Base Salary (at the annualized rate),
without Executive's consent, by more than 25%; or (c) a relocation of
Executive's principal place of employment by more than a 50 mile radius
surrounding Atlanta, Georgia, without Executive's consent.
6.4 "NONPERFORMANCE DUE TO DISABILITY" shall mean that, if
because of Disability, Executive is unable to perform the essential functions of
Executive's job, with or without reasonable accommodation, for a period of 30
consecutive days in any calendar year.
6.5 "WITHOUT GOOD REASON" shall mean termination or resignation
of Executive's employment by Executive other than for Good Reason.
7. Non-Disparagement. Executive shall not at anytime make false,
misleading or disparaging statements about the Company, its parent, subsidiaries
or affiliates, including any of their products, services, management, directors,
officers, employees, and customers.
8. Confidential Information and Covenants Not to Compete. The parties
agree that Executive's services to Company are of a unique value and that
confidential and proprietary information about Company has been or will be
obtained by, disclosed or otherwise made available to Executive as a result of
Executive's employment with Company. Accordingly, as a condition to Executive's
employment, Executive and Company also are entering into the Confidentiality,
Invention Assignment, and Non-Competition Agreement attached hereto as EXHIBIT 2
(the "CONFIDENTIALITY AND NON-COMPETITION AGREEMENT").
9. Dispute Resolution Process. All disputes between Executive and
Company that otherwise could be resolved in court shall be resolved instead by
the following alternative dispute resolution process (the "PROCESS").
9.1 Disputes Covered. This Process applies to all disputes
between Executive and Company, including those arising out of or related to this
Agreement or
4
Executive's employment by Company. Disputes subject to this Process include but
are not limited to pay disputes, contract disputes, legal disputes, wrongful
termination disputes, and discrimination, harassment or civil rights disputes.
This Process applies to disputes Executive may have with Company and also
applies to disputes Executive may have with any of Company's employees or agents
so long as the person with whom Executive has the dispute is also bound by or
consents to this Process. This Process applies regardless of when the dispute
arises and will remain in effect after Executive's employment with Company ends,
regardless of the reason it ends. This Process does not apply, however, to any
workers' compensation or unemployment compensation claims, to the extent
applicable under the circumstances.
9.2 Negotiation and Mediation. Executive and Company agree to
attempt to resolve all disputes first by direct negotiations. If direct
negotiations are not successful, the parties shall then use mediation. They
shall first attempt to agree upon a mediator. If unable to agree upon a
mediator, the parties shall request and conduct mediation under the American
Arbitration Association's National Rules for the Resolution of Employment
Disputes. Unless otherwise agreed by the parties, any mediation sessions shall
be held in Atlanta, Georgia. Temporary or interim injunctive relief may be
sought without mediating first. Any failure to mediate shall not affect the
validity of an arbitration award or the obligation to arbitrate.
9.3 Arbitration. If the dispute is not resolved through
negotiation and mediation, the parties shall request, and either party may
demand, arbitration pursuant to the American Arbitration Association's National
Rules for the Resolution of Employment Disputes. Unless otherwise agreed by the
parties, any arbitration hearing shall be held in Atlanta, Georgia. The decision
of the arbitrator shall be final and binding on the parties and on all persons
and entities claiming through the parties. Submission of their dispute to
arbitration shall be the exclusive means for resolving the dispute, to the
exclusion of any trial by a court or jury. All disputes that are not resolved by
agreement (in mediation or otherwise) shall be determined by binding
arbitration.
9.4 Injunctive Relief. Either party may request a court to issue
such temporary or interim relief (including temporary restraining orders and
preliminary injunctions) as may be appropriate, either before or after mediation
or arbitration is commenced. The temporary or interim relief shall remain in
effect pending the outcome of mediation or arbitration. No such request shall be
a waiver of the right to submit any dispute to mediation or arbitration.
9.5 Employment Status. This Process does not affect the status of
the employment relationship between the parties, which as stated above in
Section 2.2 shall be "at will;" nor does this Process guarantee continued
employment by the Company, require discharge only for cause, or require any
particular corrective action or discharge procedures.
10. Notification. Executive hereby authorizes the Company, or any of its
employees or designated representatives or counsel, to notify Executive's actual
or future employers or any governmental agency of any terms of this Agreement or
the Confidentiality and Non-Competition Agreement and Executive's
responsibilities or obligations hereunder.
5
11. Severability; Survival of Provisions. If any part of this Agreement
or any part of the Confidentiality and Non-Competition Agreement is held by any
legal authority to be unenforceable or is severed by any legal authority, the
remainder of such agreement shall be enforced to the maximum extent allowed by
applicable law. Certain provisions of this Agreement, including confidential
information and covenants not to compete (Section 8), dispute resolution process
(Section 9), notification (Sections 10 and 21), and governing law (Section 18)
of this Agreement, and all of the provisions of the Confidentiality and
Non-Competition Agreement, shall survive after any such legal determination,
after Executive's employment by Company ends regardless of the reason it ends,
and shall be enforceable regardless of any such determination or any claim
Executive may have against Company.
12. Relief for Breach. Because any breach or threatened breach by
Executive of Sections 4, 7, and 8 of this Agreement or of the Confidentiality
and Non-Competition Agreement would result in continuing material and
irreparable harm to Company, and because it would be difficult or impossible to
establish the full monetary value of such damage, Company shall be entitled to
injunctive relief in the event of any such breach or threatened breach by
Executive. Injunctive relief is in addition to any other available remedy,
including termination of this Agreement and damages. In the event of any
threatened breach of this Agreement by Executive, Company may suspend any
payment of Base Salary, incentives, bonuses, Severance Benefits and other
compensation due to Executive under this Agreement and, if Executive has
breached this Agreement, any remaining amounts to be paid under this Agreement
shall be forfeited. In the event of any breach or threatened breach by either
party which results in court-ordered relief, the breaching party shall reimburse
the non-breaching party for its reasonable attorneys' fees and other expenses
incurred to obtain such relief.
13. Waiver. No waiver of any provision of this Agreement shall be valid
unless in writing, signed by the party against whom the waiver is sought to be
enforced. The waiver of any breach of this Agreement or failure to enforce any
provision of this Agreement shall not waive any later breach.
14. Binding Effect. This Agreement is binding upon the parties and their
personal representatives, heirs, successors and permitted assigns.
15. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original and all of which, taken
together, shall constitute a single agreement.
16. Complete Agreement. This Agreement, together with the attached
Confidentiality and Non-Competition Agreement, is the final and complete
expression of the parties' agreement relating to Executive's employment by the
Company. Without limiting the foregoing, this Agreement replaces and supersedes
any prior employment agreements between Executive and Company, or its parent,
subsidiaries, predecessors or affiliates, and each party to this Agreement
hereby releases and holds harmless the other party from any obligations or
liability with respect thereto. The parties acknowledge and agree that they are
not entering into this Agreement in reliance on anything not set out in this
Agreement. This Agreement
6
shall control over any inconsistent policies or procedures of Company affecting
Executive's employment, whether in effect now or adopted later, but Company's
policies and procedures that are consistent with this Agreement, whether in
effect now or adopted later, shall apply to Executive's employment according to
the terms thereof.
17. Payroll Withholding. All payments of Base Salary, incentives,
bonuses, Severance Benefits and other compensation payable to Executive pursuant
to this Agreement or otherwise shall be subject to the customary withholding for
income taxes as determined appropriate by the Company, and shall be subject to
other withholdings or deductions as required with respect to such compensation
paid by a corporation to any employee.
18. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia, without giving effect to the
provisions thereof relating to choice of laws. Each party hereby irrevocably (a)
consents to the jurisdiction and venue for any legal action with the state
courts in Xxxxxx County, Georgia and federal courts in the Northern District of
Georgia, Atlanta Division, unless injunctive relief is sought by Company and, in
Company's judgment, that relief might not be effective unless obtained in some
other venue; and (b) waives any jurisdictional defenses (including personal
jurisdiction and venue) to any such action. These provisions do not give any
party a right to proceed in court in violation of the Dispute Resolution Process
under Section 9, above.
19. Successors And Assigns. All rights and duties of Company under this
Agreement shall be binding on and inure to the benefit of its successors,
assigns or any company which purchases or otherwise acquires it or all or
substantially all of its operating assets by any method. This Agreement shall
not be assignable by Executive other than the right to receive benefits being
passed by will or by the laws of descent and distribution.
20. Amendment. This Agreement contains the entire agreement of the
parties relating to the subject matter and may not be amended except by an
instrument in writing signed by both parties; it shall not be amended orally or
by course of dealing.
21. Notices. All notices required or permitted under this Agreement
shall be in writing and may be personally served or mailed by registered or
certified U.S. mail, postage prepaid and addressed as follows:
If to Company: Interland, Inc.
000 Xxxxxxxxx Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
If to Executive: Xxxxx Xxxxxxx
0000 Xxxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
7
Any of the above addresses may be changed at any time by notice given as
provided above; provided, however, that any such notice of change of address
shall be effective only upon receipt. All notices, requests or instructions
given in accordance herewith shall be deemed received on the date of delivery,
if hand delivered or telecopied, and 3 business days after the date of mailing,
if mailed by registered or certified mail, return receipt requested.
INTERLAND, INC. EXECUTIVE
By: //ss/ Xxx Xxxxxxxx //ss/ Xxxxx X. Xxxxxxx
-------------------------------- ------------------------------
Xxxxx Xxxxxxx
Name: Xxx Xxxxxxxx
------------------------------
Title: SVP -- Human Resources Date: 10/4/01
------------------------------ -----------------------
Date: 10/18/01
------------------------------
8
