Exhibit 10.1
March 19, 1999
Xx. Xxxxx Xxxxx
00 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Dear Xx. Xxxxx:
This agreement confirms your employment by PSINet Inc. (the "Company"), and sets
forth the terms and conditions which shall govern such employment as outlined
below. This agreement amends the terms of your employment agreement dated
January 17, 1996.
1. EMPLOYMENT:
a) The Company hereby employs you as Senior Vice President of the Company
and President, Canada and Latin America reporting to the President and
Chief Operating Officer of the Company. This is a corporate position
and as an officer of the Company you must stand for election by the
Board of Directors each year. You accept the employment and agree to
remain in the employ of the Company, and, except during vacation
periods and sickness, to provide during standard business hours a
minimum of forty hours per week of management services to the Company,
as determined by and under the direction of the President and Chief
Operating Officer of the Company or his designee.
b) During your employment you will, except during vacations, periods of
illness, and other absences beyond your reasonable control, devote your
best efforts, skill and attention to the performance of your duties on
behalf of the Company.
2. TERM OF EMPLOYMENT: The term of the employment shall continue for a period
of one (1) year from the date hereof.
3. COMPENSATION: BASE SALARY. The Company shall pay you a base salary at
the rate of $225,000 (US) per annum for 1999. You will also be eligible
for an annual bonus of up to fifty percent (50%) of your base salary. The
amount of
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annual bonus payable to you will be subject to the successful completion of
objectives established for your performance, which shall be determined by
the President of the Company. Your base salary shall be payable in such
installments as the Company regularly pays its other salaried employees,
subject to such deductions and withholdings as may be required by law or by
further agreement with you.
4. EMPLOYEE BENEFITS:
a) You shall be provided employee benefits, including (without limitation)
retirement savings, revenue bonus plan participation, four (4) weeks'
paid vacation, and life, health, accident and disability insurance
under the Company's plans, policies and programs available to employees
in accordance with the provisions of such plans, policies, and
programs.
b) The Company plans to implement a company car policy for which you would
be eligible. Until such a policy is implemented, the Company will cover
the rental or short term leasing cost (through normal expense
reimbursement) of a suitable executive vehicle up to the value of Seven
Hundred Fifty Dollars ($750.00) per month.
c) In the event you are required to move, the Company will provide to you
relocation benefits in accordance with applicable Company policy.
d) The Company has paid your tuition costs in connection with your
completion of the MBA program at Duke University. In the event that you
terminate your employment with the Company prior to the expiration of
three (3) years from the completion of such program, you agree to
reimburse the Company for all such tuition and related costs paid by it
with interest at the rate of ten percent (10%) per annum within twelve
months of your termination.
5. TERMINATION:
a) Your employment with the Company may be terminated by the Company at
any time for "Cause" as defined in Section 5(c) hereof. Upon such
termination, the Company will provide written notice whether it has
elected to use the non-Competition restrictions set forth in Section
6(a) hereof. Your employment may also be terminated by the Company at
any time without Cause provided the Company shall have given you thirty
(30) days' prior written notice of such termination. That written
notice must state whether the Company has elected to use the non-
competition restriction (which decision
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may not be rescinded). If you are terminated without cause, you will be
paid twenty-six (26) weeks of severance, plus a pro-rata bonus and
benefits will continue for the same period. In addition, your
employment may be terminated by you at any time for any reason,
provided you shall have given the Company at least thirty (30) days'
prior written notice of such termination. By the 30th day the Company
must notify you in writing whether it has elected to use the non-
Competition restriction. Such decision may not be rescinded. Failure of
the Company to so notify you shall result in the non-Competition
restriction not being in place.
b) Subject to your compliance with your obligations under Section 6
hereof, in the event that your employment terminates or is terminated
by you or the Company for any reason other than for cause, and the
Company has elected to use the non-Competition restriction, you shall
be entitled, for a period of twenty-four (24) months after termination
of employment, to the following (collectively, the "Termination
Payments"): (i) your then-current rate of base salary as provided in
Section 3; and (ii) all life insurance and health benefits, disability
insurance and benefits and reimbursement theretofore being provided to
you.
c) The Company shall have "Cause" for your termination of your employment
by reason of any breach of your agreement not to compete pursuant to
Section 6 hereof, your committing an act materially adversely affecting
the Company which constitutes wanton or willful misconduct, your
conviction of a felony, your voluntary resignation, or any material
breach by you of this agreement.
6. AGREEMENT NOT TO COMPETE:
a) In consideration of your employment pursuant to this agreement and for
other good and valuable consideration, the receipt and adequacy of
which is hereby acknowledged, you covenant to and agree with the
Company that, so long as you are employed by the Company under this
agreement and for a period of twenty-four (24) months following the
termination of such employment (but only if the Company has elected to
enforce the restriction, you shall not, without the prior written
consent of the Company, either for yourself or for any other person,
firm or corporation, manage, operate, control, participate in the
management, operation or control of or be employed by any other person
or entity which is engaged in providing Internet-related network or
communications services competitive with the Internet-related network
or communication services offered to customers by the Company, as of
the date of termination or within six (6) months
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thereafter. The foregoing shall in no event restrict you from: (i)
writing or teaching, whether on behalf of for-profit, or not-for-profit
institution(s); (ii) investing (without participating in management or
operation) in the securities of any private or publicly traded
corporation or entity; or (iii) after termination of employment,
becoming employed by a hardware, software or other vendor to the
Company, provided that such vendor does not offer network or
communication services that are competitive with the Internet-related
network or communications services offered by the Company as of the
date of termination of employment or within six (6) months thereafter.
b) You may request permission from the Company's Board of Directors to
engage in activities which would otherwise be prohibited by Section
6(a). The Company shall respond to such request within thirty (30) days
after receipt. The Company will notify you in writing if it becomes
aware of any breach or threatened breach of any of the provisions in
Section 6(a), and you shall have thirty (30) days after receipt of such
notice in which to cure or prevent the breach, to the extent that you
are able to do so. You and the Company acknowledge that any breach or
threatened breach by you of any of the provisions in Section 6(a) above
cannot be remedied by the recovery of damages, and agree that in the
event of any such breach or threatened breach which is not cured with
such thirty (30) day period, the Company may pursue injunctive relief
for any such breach or threatened breach. If a court of competent
jurisdiction determines that you breached any of such provisions, you
shall not be entitled to any Termination Payments from and after date
of the breach. In such event, you shall promptly repay any Termination
Payments previously made plus interest thereon from the date of such
payment(s) at twelve percent (12%) per annum. If, however, the Company
has suspended making such Termination Payments and a court of competent
jurisdiction finally determines that you did not breach such provision
or determines such provision to be unenforceable as applied to your
conduct, you shall be entitled to receive any suspended Termination
Payment, plus interest thereon from the date when due at twelve percent
(12%) per annum. The Company may elect (once) to continue paying the
Termination Payments before a final decision has been made by the
court.
7. INTELLECTUAL PROPERTY; Ownership of Work Product. All copyrights,
patents, trade secrets, or other intellectual property rights associated
with any ideas, concepts, techniques, inventions, processes, or works of
authorship developed or created by you during the course of performing the
Company's work (collectively the "Work Product") shall belong exclusively
to the Company and shall, to the extent possible, be considered a work made
for hire for the Company within the meaning of Title 17 of the United
States Code.
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You automatically assign, and shall assign at the time of creation of the
Work Product, without any requirement of further consideration, any right,
title, or interest you may have in such Work Product, including any
copyrights or other intellectual property rights pertaining thereto. Upon
request of the Company, you shall take such further actions, including
execution and delivery of instruments of conveyance, as may be appropriate
to give full and proper effect to such assignment.
8. TRANSFERABILITY:
a) As used in this agreement, the term "Company" shall include any
successor to all or part of the business or assets of the Company who
shall assume and agree to perform this agreement.
This agreement shall inure to the benefit of and be enforceable by you
and your personal or legal representatives, executors, administrators,
heirs, distributees, devisees and legatees.
b) Except as provided under paragraph (a) of this Section 8, neither this
agreement nor any of the rights or obligations hereunder shall be
assigned or delegated by any party hereto without the prior written
consent of the other party.
9. SEVERABILITY: The invalidity or unenforceability of any particular
provision of this agreement shall not affect the other provisions hereof,
and this agreement shall be construed in all respects as if such invalid or
unenforceable provision were omitted. If a court of competent jurisdiction
determines that any particular provision of this agreement is invalid or
unenforceable, the court shall restrict the provision so as to be
enforceable. However, if the provisions of Section 6 shall be restricted, a
proportional reduction shall be made in the payments under Section 5b.
10. ENTIRE AGREEMENT; WAIVERS: This agreement contains the entire agreement
of the parties concerning the subject matter hereof and supersedes and
cancels all prior agreements, negotiations, correspondence, undertakings
and communications of the parties, oral or written. No waiver or
modification of any provision of this agreement shall be effective unless
in writing and signed by both parties.
11. NOTICES: Any notices, requests, instruction or other document to be
given hereunder shall be in writing and shall be sent certified mail,
return receipt requested, addressed to the party intended to be notified at
the address of such
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party as set for at the head of this agreement or such other address as
such party may designate in writing to the other.
12. GOVERNING LAW: THIS AGREEMENT SHALL BE SUBJECT TO, GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. INSOFAR AS
MAY BE EFFECTED UNDER SUCH LAWS, REFERENCE TO GUIDING PRINCIPLES AND
BINDING RULES SHALL BE MADE TO THE LAW XX XXX XXXXX XX XXX XXXX, XXXXXX
XXXXXX, WITHOUT REFERENCE TO ITS PRINCIPLES OF CONFLICTS OF LAW.
13. COUNTERPARTS: This agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
shall be one and the same instrument.
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XXXXX EMPLOYMENT AGREEMENT SIGNATURE PAGE
Please confirm your agreement with the forgoing by signing and returning
one copy of this agreement to the undersigned, whereupon this agreement shall
become a binding agreement between you and the Company.
Sincerely,
PSINet Inc.
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, President and Chief Operating Officer
Accepted and Agreed to as of the day first above written:
By: /s/ Xxxxx Xxxxx
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