EMPLOYMENT AGREEMENT
This Employment Agreement (the “Agreement”) is made between Global Internetworking, Inc., a
Virginia corporation (the “Company”), and Xxxx X. Xxxxxxx (the “Executive”) and is entered into as
of October 15, 2006 and shall become effective immediately after the closing pursuant to the Stock
Purchase Agreement (the “Purchase Agreement”) entered into as of May 23, 2006 (the “Purchase
Agreement Date”), by and among Mercator Partners Acquisition Corp., Ltd., a Delaware corporation
(“Parent”), the Company, the Executive, D. Xxxxxxx Xxxxxx and Xxxxxxx X. Xxxxxxx (the “Effective
Date”).
1. Employment; Scheduled Term. Subject to the terms and conditions of this Agreement,
Company agrees to employ Executive, and Executive accepts employment and agrees to be employed by
Company during the time period commencing on the Effective Date and ending on the termination of
this Agreement as provided in Section 7 below. The obligations of Executive set forth in the
Executive Assignment of Inventions and Confidentiality Agreement referred to in Section 6 below
shall survive the Scheduled Term and shall survive the termination of Executive’s employment,
regardless of the cause of such termination. Executive hereby represents and warrants to Company
that Executive is free to enter into and fully perform this Agreement and the agreements referred
to herein without breach or violation of any agreement or contract to which Executive is a party or
by which Executive is bound.
2. Duties. Executive shall serve as Senior Vice President of Company with such duties
and responsibilities as may from time to time be assigned to Executive by the Chief Executive
Officer of Parent (the “CEO”), commensurate with and customarily assigned to Executive’s title and
position described in this sentence. The duties and services to be performed by Executive under
this Agreement are collectively referred to herein as the “Services”. Executive shall report
directly to the CEO. Executive agrees that to the best of his ability and experience he shall at
all times conscientiously perform all of the duties and obligations assigned to him under the terms
of this Agreement. At Company’s option, it will be entitled to reasonable use of Executive’s name
in promotional, advertising and other materials used in the ordinary course of its business without
additional compensation unless prohibited by law. Executive initially shall report to the offices
located in McLean, Virginia; provided that Executive’s duties will include reasonable
travel, including but not limited to travel to offices of Company, its subsidiaries and affiliates
and current and prospective customers as is reasonably necessary and appropriate to the performance
of Executive’s duties hereunder. Executive will comply with and be bound by Company’s operating
policies, procedures, and practices from time to time in effect during Executive’s employment.
3. Exclusive Service. During the term of employment, Executive will not perform
services for any other entity if such service would be in direct conflict with the Company’s
business interests. Executive will apply his skill and experience to the performance of his duties
and advancing Company’s interests in accordance with Executive’s experience and skills.
Accordingly, Executive shall not engage in any outside work, business, consulting activity or
render any commercial or professional services, directly or indirectly, for or on behalf of himself
or any other person or organization, whether for compensation or otherwise, if such services would
be in direct conflict with the Company’s business interests, except with the prior written approval
of Company and Executive shall otherwise do nothing inconsistent with the performance of
Executive’s duties hereunder.
4. Non-Competition and Other Covenants.
4.1 Non-Competition Agreement. Beginning the Effective Date and continuing for so long
thereafter as Executive is employed by Company or a subsidiary or affiliate of Company, and for the
later of (i) three years from the Effective Date or (ii) one (1) year period following the
termination of Executive’s employment with Company (collectively, the “Restricted Period”),
Executive will not, directly or indirectly, individually or as an employee, partner, officer,
director or shareholder (except to the extent permitted in Section 3 above) or in any other
capacity whatsoever of or for any person, firm, partnership, company or corporation other than
Company or its subsidiaries:
(a) Own, manage, operate, sell, control or participate in the ownership, management,
operation, sales or control of or be connected in any manner with any business engaged, in the
geographical areas referred to in Section 4.2 below, in the design, research, development,
marketing, sale, or licensing of managed data network services that are substantially similar to or
competitive with the business of Company and any of its affiliates; or
(b) Recruit, attempt to hire, solicit, or assist others in recruiting or hiring, in or with
respect to the geographical areas referred to in Section 4.2 below, any person who is an employee
of Company or any of its subsidiaries or induce or attempt to induce any such employee to terminate
his employment with Company or any of its subsidiaries.
4.2 Geographical Areas. The geographical areas in which the restrictions provided for
in this Section 4 apply include all cities, counties and states of the United States, and all other
countries in which Company (or any of its subsidiaries) are conducting business or are
contemplating conducting business at the time. Executive acknowledges that the scope and period of
restrictions and the geographical area to which the restrictions imposed in this Section 4 applies
are fair and reasonable and are reasonably required for the protection of Company and that this
Agreement accurately describes the business to which the restrictions are intended to apply.
4.3 Non-Solicitation of Customers. In addition to, and not in limitation of, the
non-competition covenants of Executive set forth above in this Section 4, Executive agrees with
Company that, for the Restricted Period, Executive will not, either for Executive or for any other
person or entity, directly or indirectly (other than for Company and any of its subsidiaries or
affiliates), solicit business from, or attempt to sell, license or provide the same or similar
products or services as are then provided, or are then contemplated of being provided, by Company
or any subsidiary or affiliate of Company to any customer of Company.
4.4 Non-Solicitation of Executives or Consultants. In addition to, and not in
limitation of, the non-competition covenants of Executive set forth above in this Section 4,
Executive agrees with Company that, for the Restricted Period, Executive will not, either for
Executive or for any other person or entity, directly or indirectly, solicit, induce or attempt to
induce any employee, consultant or contractor of Company or any affiliate of Company, to terminate
his or her employment or his, her or its services with, Company or any subsidiary or affiliate of
Company or to take employment with another party.
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4.5 Amendment to Retain Enforceability. It is the intent of the parties that the
provisions of this Section 4 will be enforced to the fullest extent permissible under applicable
law. If any particular provision or portion of this Section is adjudicated to be invalid or
unenforceable, this Agreement will be deemed amended to revise that provision or portion to the
minimum extent necessary to render it enforceable. Such amendment will apply only with respect to
the operation of this paragraph in the particular jurisdiction in which such adjudication was made.
4.6 Injunctive Relief. Executive acknowledges that any breach of the covenants of this
Section 4 will result in immediate and irreparable injury to Company and, accordingly, consents
that the Company shall have the right to seek injunctive relief and such other equitable remedies
for the benefit of Company as may be appropriate in the event such a breach occurs or is
threatened. The foregoing remedies will be in addition to all other legal remedies to which
Company may be entitled hereunder, including, without limitation, monetary damages
4.7 Executive Acknowledgment. Executive acknowledges that for purposes of enforcement
thereof, the covenants set forth in this Section 4 shall also be applied and construed as if they
were set forth in the Purchase Agreement as additional consideration extended by the Company
thereunder.
5. Compensation and Benefits.
5.1 Salary. During the term of this Agreement, Company shall pay Executive an initial
salary of $200,000 per annum. Executive’s salary shall be payable as earned at Company’s customary
payroll periods in accordance with Company’s customary payroll practices. Executive’s salary shall
be subject to review and adjustment in accordance with Company’ customary practices concerning
salary review for similarly situated employees of Company or its subsidiaries.
5.2 Benefits. Executive will be eligible to participate in Company’s employee benefit
plans of general application as they may exist from time to time, including without limitation
those plans covering pension and profit sharing, executive bonuses, stock purchases, stock options,
and those plans covering life, health, and dental insurance in accordance with the rules
established for individual participation in any such plan and applicable law. Executive will
receive such other benefits, including vacation, holidays and sick leave, as Company generally
provides to its employees holding similar positions as that of Executive. Executive has received a
summary of Company’s standard employee benefits policies in effect as of the date hereof, which
shall not be less than Executive receives as of the Purchase Agreement Date unless such benefits
are reduced for all employees holding similar positions as that of Executive. The Company reserves
the right to change or otherwise modify, in its sole discretion, the benefits offered herein to
conform to the Company’s general policies as may be changed from time to time during the term of
this Agreement.
5.3 Cash Bonus. Executive will be eligible to earn up to a $200,000 bonus (the
“Maximum Bonus”) during his first year of employment with Company. One-half of the Maximum Bonus
shall be based on the Executive’s performance against reasonable performance criteria set by the
CEO and the Board of Directors of Company (the “Board”) and communicated to the Executive and one
half of such potential bonus shall be awarded solely at the discretion of the Board.
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5.4 Stock Bonus. Executive will be granted 120,000 shares of restricted stock of
Company as promptly as practicable after the Effective Date under Company’s equity incentive plan.
Such shares of restricted stock shall vest in four (4) equal amounts over a four (4) year period
with the first 30,000 shares of restricted stock vesting on the first anniversary of the Effective
Date. Executive will be eligible to receive additional restricted stock grants in such amounts, at
such times and with such vesting schedules and other terms as are determined from time to time by
the Board.
5.5 Expenses. Company will reimburse Executive for all reasonable and necessary
expenses incurred by Executive in connection with Company’s business are in accordance with
Company’s applicable policy and are properly documented and accounted for in accordance with the
requirements of the Internal Revenue Service. Reimbursement for expenses shall include a car
allowance pursuant to Company’s policy in effect from time to time, that shall not be less than the
car allowance in effect on the Purchase Agreement Date unless such benefits are reduced for all
employees holding similar positions as that of Executive.
6. Proprietary Rights. Executive hereby agrees to execute an Executive Invention
Assignment and Confidentiality Agreement with Company in substantially the form attached hereto as
Exhibit A.
7. Termination.
7.1 Upon Death. The Executive’s employment hereunder shall terminate automatically
upon the death of the Executive. The Company shall pay to the Executive’s beneficiaries or estate,
as appropriate, the compensation to which he is entitled pursuant to Section 5.1 through the end of
the month in which death occurs, plus vesting of a pro rata portion (based upon his service through
the date of death) of any restricted stock granted to Executive pursuant to Section 5.4 determined
as if vesting was on a monthly basis over a 48 month period.
7.2 Upon Disability. If, in the opinion of a medical doctor specializing in the
appropriate medical specialty, the Executive is prevented from properly performing his duties
hereunder by reason of any physical or mental incapacity for a period of more than 180 days in the
aggregate in any twelve month period, then, to the extent permitted by law, the Executive’s
employment hereunder shall terminate and Executive shall receive all compensation due him pursuant
to Section 5.1 through the date of termination, plus vesting of a pro rata portion (based upon his
service through the date of disability) of any restricted stock granted to Executive pursuant to
Section 5.4 determined as if vesting was on a monthly basis over a 48 month period, as well as the
continuation of health benefits for a period of twelve (12) months after the termination of his
employment. Nothing in this Section 7.2 shall affect the Executive’s rights under any Company
sponsored disability plan in which he is a participant.
7.3 By Company for Cause. Company may terminate the Executive’s employment hereunder
for Cause (as defined below) at any time by giving written notice to the Executive. The Company
shall pay Executive the compensation to which he is entitled pursuant to Section 5.1 through the
end of the day of such termination. For purposes of this Agreement, the Company shall have “Cause”
to terminate the Executive’s employment during the term of this Agreement only if: (i) the
Executive materially breaches any provision of this Agreement after written notice identifying the
substance of the material breach; (ii) Executive fails or refuses to comply with any lawful
direction or instruction of Company’s Board of Directors, which
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failure or refusal is not timely cured, (iii) the Executive commits an act of fraud,
embezzlement, misappropriation of funds, or dishonesty, (iv) the Executive commits a breach of his
fiduciary duty based on a good faith determination by the Company’s Board of Directors and after
reasonably opportunity to cure if such breach is curable, (v) the Executive is grossly negligent or
engages in willful misconduct in the performance of his duties hereunder, and fails to remedy such
breach within ten (10) days of receiving written notice thereof from the Board, provided, however,
that no act, or failure to act, by the Executive shall be considered “grossly negligent” or an act
of “willful misconduct” unless committed in good faith and with a reasonable belief that the act or
omission was in or not opposed to the Company’s best interest; (vi) the Executive is convicted of
a felony or a crime of moral turpitude; or (vi) Executive has a drug or alcohol dependency.
7.4 By Company without Cause; By Executive for Good Reason. The Company may terminate
the Executive’s employment hereunder at any time, without any Cause, and Executive may resign for
Good Reason (as hereinafter defined), without any liability other than to pay to the Executive (i)
his base salary through the effective date of termination and (ii) all compensation due pursuant to
Section 5.1 as well as the continuation of salary and health benefits for a period of twelve (12)
months after the termination of his employment, plus vesting of all restricted stock granted to
Executive pursuant to Section 5.4.
7.5 Definition of Good Reason. For purposes hereof, “Good Reason” shall mean a
termination by the Executive within ninety (90) days following (i) the relocation of the primary
office of the Executive more than ten (10) miles from McLean, Virginia, without the consent of
Executive, (ii) a material change in the Executive’s duties such that he is no longer the Senior
Vice President of the Company or (iii) removal of Executive as Senior Vice President; (iv) the
assignment to the Executive of duties that are inconsistent with his position or that materially
alter his ability to function as Senior Vice President; or (v) a reduction in the Executive’s total
base compensation as set forth in Sections 5.1, 5.2, 5.3 and 5.4.
7.6 By Executive without Cause. The Executive may terminate his employment hereunder
with thirty (30) days notice at any time.
7.7 Surrender of Records and Property. Upon termination of his employment with Company
for any reason, the Executive shall deliver promptly to Company all records, manuals, books, blank
forms, documents, letters, memoranda, notes, notebooks, reports, data, tables, calculations or
copies thereof, whether in tangible or electronic format or media, which are the property of
Company or which relate in any way to the business, products, practices or techniques of Company,
and all other property, trade secrets and confidential information of Company, including, but not
limited to, all documents or electronic records which in whole or in part contain any trade secrets
or confidential information of Company, which in any of these cases are in his possession or under
his control.
7.8 Survival. Notwithstanding any termination of the Executive’s employment hereunder,
and unless specifically provided therein, the Executive shall remain bound by the provisions of
this Agreement which specifically relate to periods, activities or obligations upon or subsequent
to the termination of the Executive’s employment. Further, Company’s obligation to pay severance
upon termination of the Executive’s employment without cause shall survive termination of this
Agreement.
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8. Miscellaneous.
8.1 Severability. If any provision of this Agreement shall be found by any arbitrator
or court of competent jurisdiction to be invalid or unenforceable, then the parties hereby waive
such provision to the extent that it is found to be invalid or unenforceable and to the extent that
to do so would not deprive one of the parties of the substantial benefit of its bargain. Such
provision shall, to the extent allowable by law and the preceding sentence, be modified by such
arbitrator or court so that it becomes enforceable and, as modified, shall be enforced as any other
provision hereof, all the other provisions continuing in full force and effect.
8.2 Remedies. Company and Executive acknowledge that the service to be provided by
Executive is of a special, unique, unusual, extraordinary and intellectual character, which gives
it peculiar value the loss of which cannot be reasonably or adequately compensated in damages in an
action at law. Accordingly, Executive and Company hereby consent and agree that for any breach or
violation by Executive of any of the provisions of this Agreement including, without limitation,
Section 3 and 4), a restraining order and/or injunction may be sought against either of the
parties, in addition to any other rights and remedies the parties may have, at law or equity,
including without limitation the recovery of money damages.
8.3 No Waiver. The failure by either party at any time to require performance or
compliance by the other of any of its obligations or agreements shall in no way affect the right to
require such performance or compliance at any time thereafter. The waiver by either party of a
breach of any provision hereof shall not be taken or held to be a waiver of any preceding or
succeeding breach of such provision or as a waiver of the provision itself. No waiver of any kind
shall be effective or binding, unless it is in writing and is signed by the party against whom such
waiver is sought to be enforced.
8.4 Assignment. This Agreement and all rights hereunder are personal to Executive and
may not be transferred or assigned by Executive at any time. Company may assign its rights,
together with its obligations hereunder, to any subsidiary, affiliate or successor of Company, or
in connection with any sale, transfer or other disposition of all or substantially all the business
and assets of Company or any of their respective subsidiaries or affiliates, whether by sale of
stock, sale of assets, merger, consolidation or otherwise; provided, that any such
assignee assumes Company’s obligations hereunder. This Agreement shall be binding upon, and inure
to the benefit of, the persons or entities who are permitted, by the terms of this Agreement, to be
successors, assigns and personal representatives of the respective parties hereto.
8.5 Withholding. All sums payable to Executive hereunder shall be reduced by all
federal, state, local and other withholding and similar taxes and payments required by applicable
law to be withheld by Company.
8.6 Entire Agreement. This Agreement (and the exhibit(s) hereto) constitutes the
entire and only agreement and understanding between the parties relating to employment of Executive
with Company and this Agreement supersedes and cancels any and all previous contracts, arrangements
or understandings with respect to Executive’s employment; except that the Executive
Invention Assignment and Confidentiality Agreement shall remain as an independent contract and
shall remain in full force and effect according to its terms.
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8.7 Amendment. This Agreement may be amended, modified, superseded, cancelled, renewed
or extended only by an agreement in writing executed by both parties hereto.
8.8 Notices. All notices and other communications required or permitted under this
Agreement shall be in writing and hand delivered, sent by telecopier, sent by certified first class
mail, postage pre-paid, or sent by nationally recognized express courier service. Such notices and
other communications shall be effective upon receipt if hand delivered or sent by telecopier, five
(5) days after mailing if sent by mail, and one (l) day after dispatch if sent by express courier,
to the following addresses, or such other addresses as any party shall notify the other parties:
| If to Company: | Mercator Partners Acquisition Corp. | |||
| 0000 Xxxxxxxx Xxxxx | ||||
| Xxxxx 000 | ||||
| XxXxxx, XX 00000 | ||||
| Attn: President and General Counsel | ||||
| If to Executive: | Xxxx X. Xxxxxxx | |||
| 0000 X. Xxxxxxx Xxxxxx | ||||
| Xxxxxxxxx, XX 00000 |
8.9 Binding Nature. This Agreement shall be binding upon, and inure to the benefit of,
the successors and personal representatives of the respective parties hereto.
8.10 Headings. The headings contained in this Agreement are for reference purposes
only and shall in no way affect the meaning or interpretation of this Agreement. In this
Agreement, the singular includes the plural, the plural included the singular, the masculine gender
includes both male and female referents, and the word “or” is used in the inclusive sense.
8.11 Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original but all of which, taken together, constitute one and the
same agreement.
8.12 Governing Law. This Agreement and the rights and obligations of the parties
hereto shall be construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflict of laws.
[Remainder of page intentionally left blank; next page is signature page]
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IN WITNESS WHEREOF, Company and Executive have executed this Agreement as of the date first
above written.
| “COMPANY” | “EMPLOYEE” | |||||
By:
|
D. Xxxxxxx Xxxxxx, President | By: | Xxxx X. Xxxxxxx | |||
SIGNATURE PAGE TO EMPLOYMENT AGREEMENT
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Attachment
Exhibit A: Executive Assignment of Inventions and Confidentiality Agreement
