INTERSTATE DATA USA, INC. DEFERRED COMPENSATION AGREEMENT FOR RANDALL R. CARPENTER
INTERSTATE
DATA USA, INC.
FOR
XXXXXXX X. XXXXXXXXX
This
deferred compensation agreement (the “Agreement”)
is made effective as of the 30th day of December, 2008 (the “Effective
Date”), by and between Interstate Data USA, Inc., a corporation organized
under the laws of the State of Delaware (the “Company”),
and Xxxxxxx X. Xxxxxxxxx (the “Executive”).
RECITALS
WHEREAS,
Executive has served as the President of the Company; and
WHEREAS,
the Company recognizes that Executive has contributed to the growth and success
of the Company; and
WHEREAS,
Executive has foregone compensation for his services rendered to the Company due
to insufficient capital; and
WHEREAS,
the Company has entered into a certain private placement offering to raise
capital for the Company.
NOW,
THEREFORE, the Company has determined that it is in the best interests of the
Company to recognize the Executive’s performance by paying Executive for his
services rendered to the Company upon raising sufficient capital from the
private placement offering.
TERMS
OF AGREEMENT
NOW, THEREFORE, for and in
consideration of the mutual promises, covenants and agreements contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Definitions. As
used herein, the following terms shall have the meaning indicated:
(a) “Benefit”
shall mean the deferred compensation amount set forth in Section 2
hereof.
(b) “Beneficiary”
shall mean the person or persons designated by the Executive, upon such forms as
shall be provided by the Board, to receive payment of the Executive’s Award in
the event of the Executive’s death after vesting of the Benefit, but prior to
payment. If the Executive shall fail to designate a Beneficiary, or
if for any reason such designation shall be ineffective, or if such Beneficiary
shall predecease the Executive or die simultaneously with the Executive, then
the Beneficiary shall be, in the following order of preference: (1) the
Executive’s surviving spouse, if any, or (2) the Executive’s
estate.
(c) “Board”
shall mean the duly elected members of the Board of Directors of the
Company.
(d) “Company”
shall mean Interstate Data USA, Inc., a corporation organized under the laws of
the State of Delaware, and its successors or assigns.
(e) “Executive”
shall mean Xxxxxxx X. Xxxxxxxxx.
(f) “Internal
Revenue Code” shall mean the Internal Revenue Code of l986, as amended
from time to time.
(g) “Private
Placement Offering” shall mean that certain private placement offering,
effective on or about July 22, 2008, pursuant to which the Company is offering
7.0 million shares of the Company’s common stock at $3.00 per share, for gross
proceeds to the Company of $21,000,000 with an option to accept additional
subscriptions for an aggregate 10.0 million shares of common stock for aggregate
gross proceeds of $30.0 million, which offering has been extended until June 30,
2009. Private Placement Offering shall also mean any future private
placement offering of common stock if the current Private Placement Offering
expires.
(h) “Termination
Date” shall mean the 5th
anniversary of the Effective Date.
2. Benefit. Upon
the vesting of the Benefit pursuant to the terms of Section 3 hereof, Executive shall be entitled to
receive an amount equal to Four Hundred Twenty-Five Thousand dollars ($425,000)
of deferred compensation plus an additional Eight Thousand Three Hundred
Thirty-Three dollars Thirty-Three cents ($8,333.33) for each whole calendar
month of service with the Company after the Effective Date.
3. Vesting
of Benefit. Executive’s Benefit shall be subject to a
substantial risk of forfeiture. Executive shall become fully vested
in his Benefit upon the date on or before the Termination date that the Company
has raised four million dollars ($4,000,000) in its current Private Placement
Offering or in aggregate with any future private placement
offering. If the Company fails to raise $4,000,000 on or before the
Termination Date, the Executive’s Benefit shall be forfeited on the Termination
Date.
4. Time of
Payment of Benefit. The Benefit shall be paid to the Executive
, thirty (30) days after the Benefit becomes vested in accordance with the terms
of Section 3. Payment, however, may be made up to thirty (30)
days earlier. To the extent payment can not be made timely due an
unforeseeable administrative impracticability, such payment will be paid as soon
as administratively practicable thereafter.
5. Method of
Payment of Benefit. The Company shall pay to the Executive the
Benefit, less applicable employment and withholding taxes, in one lump-sum
payment in cash.
6. Transferability
of Benefit. The Benefit shall not be subject to alienation, assignment,
pledge, charge or other transfer and any attempt to make any such prohibited
transfer shall be void.
7. Administration
of the Agreement.
(a) Powers and
Duties. The
Board shall be responsible for the management, operation and interpretation of
the Agreement.
(b) Interpretation. The
undersigned Executive hereby accepts as binding, conclusive and final all
decisions or interpretations of the Board any questions arising under this
Agreement.
(c) Executive Bound. Any action with
respect to the Agreement taken by the Board shall be final, binding and
conclusive upon the Executive, Beneficiaries and other affected persons, in the
absence of clear and convincing evidence that the Board acted arbitrarily and
capriciously.
(d) Receipts. Any payment to
the Executive or any Beneficiary in accordance with the provisions of the
Agreement shall, to the extent thereof, be in full satisfaction of all claims
against the Company and the Board under the Agreement. If the
Executive or any Beneficiary is determined by the Board to be incompetent by
reason of physical or mental disability (including minority) to give a valid
receipt and release, the Board may cause the payment or payments becoming due to
such person to be made to another person for his or her benefit without
responsibility on the part of the Board to follow the application of such
funds.
(e) Exercise of
Discretion. In exercising any
discretion grant to them under the Agreement, the Board shall not be required to
follow past practices, act in a manner consistent with past practices, or treat
the Executive or any Beneficiary in a manner consistent with the treatment of
any other employee or service provider.
8. Withholding
or Deduction for Taxes. The Company shall have the right to
deduct from any cash payment under the Agreement any federal, state, local or
foreign taxes that the Company determines to be required by law to be withheld
with respect to such payment.
9. Miscellaneous.
(a) Unfunded
Agreement. The obligations
of the Company under this Agreement shall be paid from the general assets of the
Company not from any particular fund. The Executive shall have the
status of a general unsecured creditor of the Company, and the Agreement
constitutes a mere promise by the Company to make benefit payments in the
future. Nothing contained in this Agreement shall be interpreted to
grant to the Executive or any Beneficiary, any right, title or interest in any
property of the Company or its stockholders.
(b) Governing Law. The Agreement
shall be construed, administered, and governed in all respects under and by the
internal laws of the State of Texas, without giving effect to principles of
conflict of laws, and applicable federal laws.
(c) Notices. Any
notice given pursuant to this Agreement may be served personally on the party to
be notified or may be mailed, with postage thereon fully prepaid, by certified
mail, with return receipt requested, or sent by overnight delivery service,
addressed as set forth by the party's signature of this Agreement or at such
other address as such party may designate in writing from time to
time. Any notice given as provided in the preceding sentence shall be
deemed delivered when given, if personally served, or five (5) business days
after mailing, if mailed.
(d) Further
Acts. Each party to this Agreement agrees to perform such
further acts and to execute and deliver such other and additional documents as
may be reasonably necessary to carry out the provisions of this
Agreement.
(e) Severability. If any provision
of this Agreement is found, held or deemed to be void, unlawful or unenforceable
under any applicable statute or other controlling law, the remainder of the
Agreement shall continue in full force and effect.
(f) Headings and
Subheadings. Headings and
subheadings in this Agreement are inserted for convenience only and are not to
be considered in the construction of the provisions hereof.
(g) Gender. The masculine, as
used herein, shall be deemed to include the feminine and the singular to include
plural, except where the context requires a different construction.
(h) No Trust or Fund
Created. This Agreement shall not create or be construed to
create a trust or separate fund of any kind or a fiduciary relationship between
the Company and the Executive or any other person. The Award Benefit
represents only the Company’s unfunded and unsecured promise to pay an amount to
the Executive in the future. To the extent that the Executive or any
other person acquires a right to receive payments from the Company pursuant to
this Agreement, that right shall be no greater than the right of any unsecured
general creditor of the Company.
(i) Waiver and
Assignment. No waiver by either party of any breach by the
other party to this Agreement of any condition or provision of this Agreement
shall be deemed a waiver of any other conditions or provisions of this
Agreement. Except as set forth herein, no agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement.
(j) Complete
Agreement. This Agreement and those agreements and documents
expressly referred to herein embody the complete agreement and understanding
among the parties and supersede and preempt any prior understandings, agreements
or representations by or among the parties, written or oral, which may have
related to the subject matter of this Agreement in any way.
(k) Non-Exclusive
Benefits. The benefits granted to the Executive under this
Agreement shall be in addition to other compensation or benefits related to his
employment with the Company.
(l) No Employment
Contract. This Agreement
does not constitute a contract of employment or impose on the Executive or the
Company any obligations to retain the Executive as an employee, to change the
status of the Executive’s employment, or to change the Company’s policies
regarding termination of employment.
(m) Compliance with Section
409A. It is the
Company’s intention that the benefits and rights to which the Executive could
become entitled to under this Agreement are exempt from or comply with Section
409A of the Internal Revenue Code (“Section 409A”) by reason of the short-term
deferral exception set forth in Section 1.409A-1(a)(4) of the Treasury
Regulations, and the provisions of the Agreement shall be interpreted in a
manner consistent with this intention. If the Executive or the
Company believes, at any time, that any of such benefit or right is not exempt
and does not comply, it shall promptly advise the other and shall negotiate
reasonably and in good faith to amend the terms of such benefits and rights such
that they comply (with the most limited possible economic effect on the
Executive and on the Company) with Section 409A. Notwithstanding the
foregoing, the Company does not make any representations that the benefits under
this Agreement are exempt from, or satisfy, the requirements of Section 409A,
and the Company shall have no liability or other obligation to indemnify or hold
harmless the Executive or any Beneficiary for any tax, additional interest or
penalties that the Executive or any Beneficiary may incur in the event that any
provision of this Agreement, or any amendment or modification thereof, or any
other action taken with respect thereto, is deemed to violate any of the
requirements of Section 409A.
(n) No Rights as
Stockholders. The
Executive and Beneficiaries shall have no rights as stockholders of the Company
as a result of any rights granted to them under the Agreement.
(o) Advice of
Counsel. The Executive acknowledges and agrees that he has
been provided with a copy of this Agreement for review prior to signing it, that
he has been provided the opportunity to have this Agreement reviewed by his own
attorney prior to signing it, and that he understands the purposes and effects
of this Agreement.
10. Termination
Date. The Agreement shall terminate on the Termination
Date.
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IN
WITNESS WHEREOF, the parties have entered into this Interstate Data USA, Inc.
Deferred Compensation Agreement with Xxxxxxx X. Xxxxxxxxx as of the date first
above written.
| COMPANY: | |||
| INTERSTATE DATA USA, INC. | |||
|
|
By:
|
/s/ Xxxxxxx X. Xxxx | |
| Name: | Xxxxxxx X. Xxxx | ||
| Title: | Chairman of the Board | ||
| EXECUTIVE: | |||
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|
By:
|
/s/ Xxxxxxx X. Xxxxxxxxx | |
| Xxxxxxx X. Xxxxxxxxx | |||
| Address: | |||
|
0000
Xxxxxxx Xxxxxxx
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Xxxxxxx,
Xxxxxxxx 00000
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