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EXHIBIT 10.11
EMPLOYMENT AGREEMENT
This Agreement made and entered into as of the 1st day of January,
1999, by and between SAGE NETWORKS, INC., a Delaware corporation, having a place
of business at 000 Xxxxx Xxxxxx, Xxxxxxxxx, XX 00000 ("Employer"), and, Xxxxxxx
X. Xxxxxxx, having an address at 0 Xxx Xxxxx Xxxxx, Xxxxxxxx, XX 00000
("Employee").
WITNESSETH:
WHEREAS, Employer is engaged in the Internet Web hosting and related
services business; and
WHEREAS, Employer desires to employ Employee as Co-Chairman of
Employer, and Employee desires to be so employed by Employer, all pursuant to
the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants herein contained, it is agreed as follows:
1. EMPLOYMENT: DUTIES
(a) Employer hereby agrees to employ Employee, and Employee
hereby agrees to accept employment during the term hereof as Co-Chairman of
Employer, and shall perform such services as are customarily performed by
persons holding such offices and shall be subject at all times to the direction
of the Board of Directors of Employer. Nothing herein contained shall be
construed as, including, but not limited to (i) preventing Employee from
devoting a portion of his business time to other business ventures of Employee
or preventing Employee from investing his personal assets in any business,
provided such business venture or business does not compete with Employer or
conflict with Employee's duties and obligations as an officer and director of
the Employer, or (ii) preventing Employee from purchasing securities in any
corporation whose securities are regularly publicly traded, if such purchases
shall not result in his owning beneficially at any time 5% or more of the equity
securities of any corporation engaged in a business which is competitive to that
of Employer.
2. TERM
Employee's employment hereunder shall be for a term commencing
January 1, 1999 and ending on December 31, 1999. The Agreement shall be
automatically extended from year to year thereafter unless either party gives
not less than three (3) months prior written notice to the other that such party
elects to have the Agreement terminated effective at the end of the initial or
then current renewal term.
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3. COMPENSATION
(a) As compensation for the performance of his duties on behalf of
Employer, Employer shall pay Employee a salary at the rate of One Hundred Eighty
Thousand Dollars ($180,000.00) per annum, payable in installments in accordance
with the usual practice of the Employer.
(b) Employer shall reimburse Employee for the expenses incurred by
Employee in connection with his duties hereunder upon presentation by Employee
of the details of vouchers for such expenses in accordance with customary
Employer practice.
(c) Employee shall be entitled to participate in all retirement, life
insurance, medical insurance, disability insurance, vacation, savings and other
employee benefit plans generally available to the senior officers of the
Company, so long as such benefits comply with applicable law (including without
limitation the Internal Revenue Code of 1986, as amended, and ERISA).
4. NON-COMPETITION
(a) During the term of this Agreement and for a period of twenty-four
(24) months from the date of termination of his employment hereunder for
whatever reason, Employee agrees that he will not solicit any customers who are
presently or may hereafter become customers of Employer unless such solicitation
is entirely unrelated to Employer's business, or compete in any way with
Employer alone or together with others in which Employer is engaged in business
at the time of termination of employment.
(b) Subsequent to the expiration or termination of this Agreement,
Employee will not interfere with or disrupt or attempt to disrupt Employer's
business relationship with its customers or suppliers or solicit the employees
or Employer.
(c) During the term of this Agreement and for a period of twenty-four
(24) months from the date of termination of his employment hereunder for
whatever reason, Employee will not disclose or use or enable anyone else to use
any information or data which may be obtained by him or available to him during
the term of employment.
(d) In the event that Employee breaches any provisions of this
paragraph or there is a threatened breach, then, in addition to any other rights
which Employer may have, Employer shall be entitled to injunctive relief to
enforce the restrictions contained herein. In the event that an actual
proceeding is brought in equity
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to enforce the provisions of this paragraph, Employee shall not urge as a
defense that there is an adequate remedy at law nor shall Employer be prevented
from seeking any other remedies which may be available.
(e) The existence of any claim or cause of action by Employee against
Employer, whether predicated upon this Agreement or otherwise, shall not
constitute a defense to the enforcement by Employer of the foregoing restrictive
covenants but shall be litigated separately.
5. TERMINATION
(a) Anything to the contrary notwithstanding, this Agreement shall
terminate 30 days after the Employee's (i) death or (ii) disability for a period
of not less than twenty-six consecutive weeks; provided, however, that the
provisions of Section 6 hereof shall remain in full force and effect through the
end of the term hereof.
(b) Employee's employment hereunder may also be terminated by the
Employer before the expiration of the term hereof only for cause as herein
defined. "Cause" shall mean only one or both of the following occurrences:
(i) The Employee's conviction of a felony by a court of
competent jurisdiction (which conviction, through lapse of time or
otherwise, is not subject to appeal); or
(ii) The Employee's commission of an act of fraud or
embezzlement upon the Employer.
6. SEVERANCE
In the event of termination of employment of Employee by
Employer before the expiration of the term hereof, except when such termination
is in accordance with the provisions of paragraph 5(a) or 5(b) hereof, Employer
will provide Employee with severance pay in an amount equal to Employee's base
annual salary through the end of the term hereof, which shall be payable in a
lump sum, discounted based on the prime rate of Chase Bank then in effect, which
lump sum shall be payable within 30 days of the date of termination. Employer
shall also continue to provide to Employee the retirement benefits, life
insurance, medical insurance and disability insurance pursuant to Section 3(d)
through the end of the term hereof.
In the event of termination of employment of Employee before
the expiration of the term hereof pursuant to the provisions of paragraph 5(a)
hereof, Employer will: (i) provide Employee (or Employee's estate) with
severance pay in an
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amount equal to one year's base annual salary, which shall be payable in a lump
sum, discounted based on the prime rate of Chase Bank then in effect, which lump
sum shall be payable within 30 days of the date of termination; (ii) continue to
provide to Employee the retirement benefits, life insurance, medical insurance
and disability insurance pursuant to Section 3(d) through the end of the term
hereof; and (iii) continue to provide Employee's spouse and minor children with
medical benefits pursuant to Section 3(d) through the end of the term hereof.
7. NOTICES
All notices hereunder shall be in writing and shall be
delivered in person or given by registered or certified mail, postage prepaid,
and sent to the parties at the respective addresses above set forth. Either
party may designate any other address to which notice shall be given, by giving
notice to the other of such change of address in the manner herein provided.
8. SEVERABILITY OF PROVISIONS
If any provision of this Agreement shall be declared by a
court of competent jurisdiction to be invalid, illegal or incapable of being
enforced in whole or in part, the remaining conditions and provisions or
portions thereof shall nevertheless remain in full force and effect and
enforceable to the extent they are valid, legal and enforceable, and no
provision shall be deemed dependent upon any other covenant or provision unless
so expressed herein.
9. GOVERNING LAW
This Agreement shall be construed and governed by the laws of
the State of New York.
10. NON-WAIVER
The failure of either party to insist upon the strict
performance of any term or condition in this Agreement shall not be considered a
waiver or relinquishment of future compliance therewith.
11. ENTIRE AGREEMENT; MODIFICATION
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This Agreement contains the entire agreement between the
parties relating to the subject matter hereof. No modification of this Agreement
shall be valid unless it is made in writing and signed by the parties hereto.
12. NON-ASSIGNMENT; SUCCESSORS
Neither party hereto may assign his or its rights or delegate
his or its duties under this Agreement without the prior written consent of the
other party; provided, however, that (i) this Agreement shall inure to the
benefit of and be binding upon the successors and assigns of the Employer upon
any sale of all or substantially all of the Employer's assets, or upon any
merger, consolidation or reorganization of the Employer with or into any other
corporation, all as though such successors and assigns of the Employer and their
respective successors and assigns were the Employer; and (ii) this Agreement
shall insure to the benefit of and be binding upon the heirs, assigns or
designees of the Employee to the extent of any payments due to them hereunder.
As used in this Agreement, the term "Employer" shall be deemed to refer to any
such successor or assign of the Employer referred to in the preceding sentence.
13. COUNTERPARTS
This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
day and year first above written.
SAGE NETWORKS, INC.,
Employer
By:/s/ Xxxxxxx X. Xxxx
_____________________
Xxxxxxx X. Xxxx
Co-Chairman
/s/Xxxxxxx X. Xxxxxxx
________________________
Xxxxxxx X. Xxxxxxx
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