EXHIBIT 4.18
FOR PRINCIPAL OFFICERS
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement ("Agreement") is entered into in Chennai
India on 20th February, 2002 between:
1. Xxxxxx Infoway Limited ("Sify") a company incorporated in India and having
its principal office at Tidel Park 0xx xxxxx, 0 Xxxxx Xxxx xxxx, Xxxxxxxx,
Xxxxxxx 600 113 India and
2. Xx. X. X. Xxxxxxxxxxxxxxxx ("Executive") residing at A2 Alsa Brentwood, 38
First Main Road, R. A. Puram, Chennai -- 600 028.
The operations of Sify and its affiliates are a complex matter requiring
direction and leadership in a variety of areas including strategic planning,
financial, regulatory, community relations and others. Executive is currently
employed as Sify's Chief Financial Officer. Considering the current status of
Sify's operation, Sify desires that the Executive should continue in the
employment of Sify and has requested the Executive to continue as its Chief
Financial Officer and the Executive has agreed to do so subject to the terms and
conditions contained herein .
Sify and the Executive agree as follows:
1. Sify would continue to employ the Executive as its Chief Financial
Officer. Executive agrees to continue such employment. The position is
based in Chennai, India. This agreement shall be valid for an initial
period of Three (3) years from 20.02.2002 till 20.02.2005.
2. During the term of employment the Executive shall:
a. Observe and comply with the policies of Sify
b. Serve Sify faithfully, diligently and competently to the best of his
ability.
c. Report to the Managing Director and CEO and the Board of Directors of
Sify
d. Serve, without further compensation, as Director of one or more of
Sify's affiliates as desired by Sify
3. During the term of employment the Executive shall not, without prior
written consent of Sify's Board of Directors:
a. Accept any other employment with a third party
b. Serve on the Board of Directors or any similar body of any other
business entity
c. Engage directly or indirectly in any other business activity that
competes with the business of Sify and its affiliates. (Affiliates
mean and include businesses in which Sify has an equity or debt stake
in excess of 5% of the capital of such business).
4. During the term of employment the Executive shall be entitled to following
"compensation and benefits" (all subject to deduction of tax as per
applicable law):
a. "Base salary" as set out in Annexure A which includes Salary,
allowances, benefits and perquisites or as amended with mutual
consent from time to time
b. "Performance bonus" as set out in Annexure B which is a variable pay
linked to performance or as amended with mutual consent from time to
time
c. Vacation/leave as per Sify's policy for Employees
d. Reimbursement of business expenses incurred on Sify's behalf as per
Sify's policy for business expenses incurred by Employees
5. Executive acknowledges that because of his employment, he is in a
confidential relationship with Sify and has access to confidential
information and trade secrets of Sify. Confidential information or trade
secrets include all information relating to customers, business
strategies/plans, business investments, marketing plans/techniques,
business operation methods/practices etc. Executive agrees that such
confidential information or trade secrets shall not be disclosed by him to
any third party except when mandated by law and shall not be used by him
for any purpose except in the performance of his work for Sify.
6. Executive agrees that all work of a copyrightable or patentable nature
done in the course of work for Sify belong to Sify and undertakes to help
in every way to get Sify's ownership of such copyrights/patents duly
registered.
7. Sify agrees to indemnify the Executive, his executors, administrators or
assigns for all Expenses (as defined) which the Executive incurs or
is/becomes legally obligated to pay in connection with any Proceedings (as
defined).
"Expenses" shall include, without limitation, damages, judgments, fines,
penalties, settlements and costs, attorney's fees/expenses, costs of
attachment or similar bonds, investigations and any expenses of
establishing a right to indemnification.
"Proceeding" shall include any threatened, pending or completed claim,
action, suit or proceeding, whether brought by or in the right of Sify or
otherwise and whether of a civil, criminal, administrative or
investigative nature, in which Executive may be or may have been involved
as a party or otherwise
a. by reason of the Executive's employment in Sify or
b. by reason of the Executive, at Sify's request, being a director or
officer of any company or
c. by reason of any actual or alleged error or misstatement or
misleading statement made or suffered by Executive, or
d. by reason of any action taken by him or of any inaction on the
Executive's part.
Such an agreement by Sify to indemnify the Executive shall not apply
a. to any obligation by Executive to disgorge profits made from sale and
purchase of securities pursuant to Securities Exchange regulations
applicable where the securities of Sify are listed.
b. to any obligation of Executive arising from any willful act
i. that has resulted in personal financial gain to the Executive or
ii. that was done with a malicious intent or
iii. of gross negligence by the Executive.
Sify agrees to advance money to the Executive for Expenses to be incurred
upon request by the Executive. Executive undertakes to render true and
complete accounts of the expenses and to repay Sify any advance in excess
of actual Expenses indemnifiable under this Agreement.
Indemnification obligation shall not apply to any proceeding/action
brought by the Executive without prior approval of Sify unless such an
proceeding/action is to establish the right of the Executive under this
Agreement.
This clause applies with retrospective effect from the date Executive
commenced his employment with Sify (even though that date is prior to this
Agreement) and extends even after Executive ceases to be in the employment
of Sify. This clause survives the expiry or earlier termination of this
Agreement.
8. This agreement (except clause 7 above) terminates on the expiry of the
term of this agreement unless both parties agree to renew it six months
before the expiry of this agreement. This agreement may be terminated
before the expiry of the agreement only as under and subject to the
consequences provided hereunder:
a. Termination of the Agreement by the Executive for following "Good
reasons":
i. Sify breaching its obligations in paying compensation
ii. Sify demoting the Executive from his current position
iii. Sify assigning duties to Executive inconsistent with his
current/promoted positions
iv. Sify changing the location of the office of the Executive from
Chennai
v. Within six months after Occurrence of a Change of control except
if joining Xxxxxx Computer Services Limited
b. Termination of the Agreement by Executive without assigning any
reason.
c. Termination by Sify
d. Death of the Executive
The parties agree that "Change of Control" means and includes:
a. Change in ownership structure of Sify from that prevalent on the date
Executive commenced services with Sify or any date thereafter whereby
any person or group of persons or entity or group of entities acquire
in one or more transactions (i) beneficial ownership in Sify,
directly or indirectly, in excess of 25% of the outstanding equity
shares and becomes the largest group owning stock/shares in Sify or
(ii) ability to command majority voting rights in Sify's Board of
Directors.
b. Sale or divestment (including through mergers, demergers,
consolidations, acquisitions) of a substantial part of the assets or
business of Sify whereby the majority owners of Sify prior to such
sale/divestment don't receive majority ownership in the acquiring
entity.
9. In the event of death of the Executive, termination is effective on the
date of death. In all other instances of termination before expiry of the
agreement, both parties agree to give a written notice to the other of
intent to terminate the Agreement and the termination is effective six (6)
months after the notice is received.
10. Executive is entitled to full compensation and benefits (excluding the
performance bonus) up to the date of termination of the Agreement.
Executive is entitled to pro rated performance bonus up to the date of
termination of the Agreement in the event termination notice is served by
Executive for "Good reasons" or served by Sify within one year after
Change of Control.
11. Executive is entitled following additional terminal compensation of Base
salary (as referred to in Clause 4a) in the event of termination by Sify
for any reason or by Executive for Good Reasons:
a. If notice of termination is served within 1 year from the date of
this agreement or 1 year after a change of Control, 1 year Base
salary
b. In all other circumstances, 6 months Base salary
12. Executive has been provided by Sify a loan of Rs. 100 lakhs which is
repayable by the Executive with interest on 31 December 2002. In
consideration of the Executive agreeing to continue in the employment of
Sify as aforesaid, Sify agrees to pay the Executive an Additional
Compensation sufficient to repay the loan (income tax to Executive's
account) and an Additional Compensation sufficient to pay the interest
(income tax to Sify's account), at the earliest of the following
circumstances:
a. On the loan falling due for repayment
b. On the occurrence of a Change of Control
c. On the death of the Executive
(such Additional Compensation referred above shall be reduced by the value
as on the date of such Additional Compensation of specified market liquid
stock options granted before 31.12.2000, vested until that date).
13. This Agreement is subject to the laws of India.
14. It is the intent of both the parties to render this agreement enforceable
to the fullest extent permitted by law. Any clause that turns out to be
invalid should not render the entire agreement invalid.
For Xxxxxx Infoway Limited
Xx. X. Xxxxxxxxxx Xx. X.X. Xxxxxxxxxxxxxxxx
Director Chief Financial Officer
EXECUTIVE EMPLOYMENT AGREEMENT
ANNEXURE A BASE SALARY
Salary:
Basic salary Rs lakhs per annum 15,99,600.00
Special allowance 12,18,364.00
House Rent allowance 7,99,800.00
Perquisites/benefits:
Provision of Company car Yes
Conveyance expenses 72,000.00
Driver's salary 42,000.00
Vehicle maintenance expenses 24,000.00
Medical expenses 15,000.00
Leave travel expenses 1,33,300.00
Provident fund contribution 1,91,952.00
Gratuity 63,984.00
Total Base Salary Rs lakhs per annum 41,60,000.00
ANNEXURE B PERFORMANCE BONUS
Bonus payable on accomplishment of
KRA/KPI Rs lakhs per annum 15,00,000.00
