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EXHIBIT 10.53
SUPPLEMENTAL EXECUTIVE COMPENSATION AGREEMENT
THIS SUPPLEMENTAL EXECUTIVE COMPENSATION AGREEMENT
("Agreement") is entered into effective as of the 1st day October, 1999, by and
between HIGH SPEED ACCESS CORP., a Delaware corporation (the "Company") and
XXXXXX X. X'XXXXX, an individual resident of Colorado ("Executive").
RECITALS:
Executive desires to be employed by the Company and the Company desires
to employ Executive. As a condition of such employment, Executive and the
Company desire to execute this Agreement.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, it is agreed by and between the
Company and Executive as follows:
1. Definitions. The following words and phrases, when used herein,
shall have the following meanings:
A. "Board" means the Company's Board of Directors.
B. "Cause" means that Executive's employment with the Company
shall have terminated upon the occurrence of any of the following events:
(a) The discharge of Executive for willful
misconduct, dishonesty or fraud on Executive's part in connection with
the performance of any of his duties under the Employment Agreement; or
(b) The discharge of Executive for a material breach
by Executive of any of the terms of Sections 8 or 10 of the Employment
Agreement; or
(c) The discharge of Executive upon a determination
by the Board, acting in good faith and with reasonable justification,
that Executive's performance in his position as Chief Operating Officer
of the Company has been unsatisfactory, after first having given
written notice to Executive that his performance has been
unsatisfactory (which notice shall set forth in reasonable detail the
nature of the unsatisfactory performance), and Executive having failed
to cure such unsatisfactory performance within thirty (30) days
thereafter to the reasonable satisfaction of the Board; or
(d) The discharge of Executive for conviction of a
felony or a crime involving moral turpitude.
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C. "Common Stock' means the $.01 par value per share common
stock of the Company.
D. "Company" means High Speed Access Corp., a Delaware
corporation, and its successors.
E. "Disability" or "Disabled" means a physical or mental
condition which in the Company's judgment, based on medical reports and other
evidence satisfactory to the Company, prevents Executive from satisfactorily
performing his usual duties for the Company as Chief Operating Officer for a
continuous period of six (6) months.
F. "Employment Agreement" means the Employment Agreement
between the Company and Executive dated October 1, 1999.
G. "Good Reason" means that Executive shall have terminated
his employment with the Company upon the determination by Executive that any or
more of the following events has occurred:
(a) a material change in Executive's duties as Chief
Operating Officer or an adverse change in Executive's title; or
(b) any reduction by the Company of Executive's
Salary or a material reduction in Executive's benefits.
I. "Option" means the option to purchase the Option Shares
pursuant to the Option Agreement.
J. "Option Agreement" means the Stock Option Agreement
effective as of October 1, 1999 between the Company and Executive.
K. "Option Shares" means the 750,000 shares of Common Stock
subject to the Option.
L. "Salary" shall have the meaning given it in the Employment
Agreement.
2. Payment Election; Cancellation of Option.
A. If, as of September 30, 2002, the Spread (as defined
herein) is less than Two Dollars ($2.00) per share, Executive may elect, with
respect to all or a portion of the Option Shares then outstanding (including
Option Shares which under the provisions of the Option Agreement are not then
exercisable by Executive), to surrender to the Company for cancellation the
unexercised Option, or portion thereof to which the election relates, and to
receive from the Company in
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exchange therefor a cash payment equal to the product of [i] Two Dollars ($2.00)
multiplied by [ii] the number of Option Shares then outstanding and not
previously exercised by Executive as to which the election relates. Such payment
by the Company shall be in lieu of Executive's exercise of the Option, or the
portion thereof to which the election relates. Executive may exercise this
election by delivering written notice of exercise to the Company (the "Election
Notice") on or before October 10, 2002. "Spread" shall mean the difference
between the exercise price per share of the Option Shares and the Fair Market
Value per share of the Option Shares. "Fair Market Value" per share shall mean
the average of the closing sale prices of the Common Stock as quoted on the
Nasdaq National Market System for the ten (10) consecutive trading days
immediately preceding the date of measurement.
B. If Executive's employment with the Company is terminated
without Cause or for Good Reason, within the six (6) month period following the
hiring by the Company of a chief executive officer, 250,000 of the Option Shares
(to the extent not then vested and exercisable) shall automatically vest and
become immediately exercisable by Executive (the "Vested Option Shares"). If the
Spread on the Vested Option Shares is less than Two Dollars ($2.00) per share as
of the date of Executive's termination of employment, Executive may elect, with
respect to all or any portion of the Vested Option Shares, to surrender to the
Company for cancellation the unexercised Option, or portion thereof to which the
election relates, and to receive from the Company in exchange therefor a cash
payment equal to [i] Two Dollars ($2.00) multiplied by the number of Vested
Option Shares as to which the election relates, multiplied by [ii] the number of
months during which Executive has been employed by the Company (with any partial
month in which Executive has served ten or more days counted as one month),
divided by [iii] 12. Such payment by the Company shall be in lieu of Executive's
exercise of the Option with respect to the Vested Option Shares, or the portion
of the Vested Option Shares to which the election relates. Executive may
exercise this election by delivering an Election Notice within ten (10) days
after the date of Executive's termination of employment.
3. Payment. Subject to Executive's right to defer any payment as
provided in Section 6 of this Agreement, the Company shall pay Executive any
amount to which he is entitled under Section 2 of this Agreement in one lump sum
payment within thirty (30) days after receipt of Executive's Election Notice.
The Company shall deduct from any payments to Executive under this Agreement any
federal, state or local withholding or other taxes or charges which the Company
is required to deduct under applicable law.
4. Forfeiture. Except as provided in Section 2.B of this Agreement, all
rights to any payments to Executive under this Agreement will be discontinued
and forfeited, and the Company will have no further obligation hereunder to
Executive under this Agreement upon the termination of Executive's employment
with the Company for any reason, whether voluntary or involuntary.
5. Accrual of Payment Amounts. The Company shall accrue the sum of Five
Hundred Thousand Dollars ($500,000) per year in each of the first three years of
Executive's employment with the Company to assist it in satisfying its
liability, if any, to Executive under this Agreement. The Company shall remain
the owner of amounts accrued under this Agreement. Executive shall have
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only the Company's unsecured promise to pay. The rights accruing to Executive
shall be those of an unsecured general creditor of Company. Any contract, policy
or other asset which the Company may utilize to assure itself of the funds to
make payment shall not serve in any way as security to Executive for the
Company's performance under this Agreement. Any account established under this
Agreement by the Company is for bookkeeping purposes only and shall not be
considered to create a fund or trust for Executive or his beneficiary.
6. Deferral Election.
A. Deferral Election. Executive may elect to defer the receipt
of all or a portion of the cash payments otherwise payable to him by the Company
under Section 2.A of this Agreement. An election by Executive to defer any
payment shall be made in writing and shall specify the dollar amount of the
payment to be deferred. Executive's written election under this Section 6 must
be delivered to the Company on or before December 31, 2001 and shall be
irrevocable.
B. Ownership and Investment of Deferred Amounts. Amounts
deferred by Executive may be kept in any investment vehicles or assets as may be
selected by the Company in its discretion. The Company shall be the owner of all
amounts deferred by Executive.
C. Disposition of Executive's Account. Payment of any amounts
deferred by Executive hereunder shall be made to Executive on or before the
first business day of the calendar month immediately following the month in
which Executive separates from service with the Company for any reason. Except
as otherwise expressly provided herein, amounts credited to Executive shall be
paid to Executive in a single sum cash payment. If Executive dies before
distribution of all amounts credited to him, any amounts remaining shall be
distributed to his designated beneficiary in a single sum payment. If there is
no valid beneficiary designation filed with the Company at the time of
Executive's death, distribution of amounts otherwise payable to Executive shall
be paid to the personal representative of Executive's estate as a part of his
estate.
7. Nontransferability/Nonalienability. No right of Executive or his
beneficiary to receive any payment pursuant to this Agreement shall be subject
to alienation, transfer, sale, assignment, pledge, attachment, garnishment or
encumbrance of any kind. Any attempt to alienate, sell, transfer, assign, pledge
or otherwise encumber any such payments whether presently or thereafter payable
shall be void. Any payment due shall not in any manner be subject to the debts
or liabilities of Executive, his beneficiary or any other person.
8. No Guarantee of Employment. This Agreement shall not be deemed to
constitute a contract of employment between the parties, nor shall any provision
restrict the Company's right to discharge Executive, with or without cause, or
restrict Executive's right to terminate his employment with the Company.
9. Enforceability. The Company shall require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the stock or assets of
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the Company to assume and agree to perform this Agreement in the same manner and
to the same extent that the Company would be required to perform it if no such
succession had taken place.
10. Notices. All notices required or permitted by this Agreement shall
be in writing and shall be given or made by personal delivery or by certified or
registered first-class mail, return receipt requested, postage prepaid, or by a
reputable overnight courier, at the following address, or such other address as
provided in writing by the person to receive the notice to the person providing
the notice: if to the Company: High Speed Access Corp., 0000 Xxxx Xxxxxxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxx 00000; if to Executive: Xxxxxx X. X'Xxxxx, 00 Xxxxxx
Xxxxx Xxxx, Xxxxxxxxx, Xxxxxxxx 00000. Any notice or other communication
hereunder shall be deemed to have been duly given or made if made by hand, when
delivered against receipt therefor or when attempted delivery shall be rejected,
as the case may be, if made by letter, upon deposit thereof in the mail, postage
prepaid, registered or certified, with return receipt requested, and if by
reputable overnight courier, when sent.
11. Assignment. This Agreement may not be assigned by Executive. This
Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.
12. Waiver of Breach. Failure or delay by either party to insist upon
compliance with any provision hereof shall not operate as, and is not be
construed as, a waiver or amendment of such provision. The waiver by either
party of a breach of any provision of this Agreement by the other shall not
operate or be construed as a waiver of any subsequent breach, whether occurring
under similar or dissimilar circumstances.
13. Entire Agreement; Modification. This Agreement, the Employment
Agreement and the Option Agreement constitute the entire agreement between the
parties with regard to the subject matter hereof, superseding all prior
understandings and agreements, whether written or oral. This Agreement may not
be revoked or revised except by a writing signed by the Company and Executive.
14. Severability. Should a court of competent jurisdiction determine
that any part of this Agreement is not fully enforceable, the unenforceable
portion shall be severed from the Agreement and the remainder of this Agreement
shall be fully enforced.
15. Governing Law. This Agreement shall be governed by the laws of the
State of Colorado.
16. Jurisdiction. The Company and Executive agree and consent to the
exclusive jurisdiction of the courts of the State of Colorado and of any federal
court located in Denver, Colorado in connection with any action or proceeding
arising out of or relating to this Agreement, any document or instrument
delivered pursuant to or in connection with this Agreement, or any breach of
this Agreement or any such document or instrument.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
HIGH SPEED ACCESS CORP.
By: /s/ Xxxxx X. Xxxxx, Xx.
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Title: Chairman
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/s/ Xxxxxx X. X'Xxxxx
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XXXXXX X. X'XXXXX
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