EXHIBIT (e)(4)
EMPLOYMENT AGREEMENT
This Employment Agreement is made and entered into by and between Telocity,
Inc. (the "Company") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇. (the "Employee") on December 10th,
1999.
1. POSITION AND DUTIES. The Employee shall be employed by the Company as
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its Executive Vice President and Chief Financial Officer reporting only to the
Company's Chief Executive Officer (CEO) beginning no later than January 3rd,
2000 (the "Effective Date"). Employee agrees to devote his full business time,
energy and skill to his duties at the Company. These duties shall include those
duties customarily performed by the Chief Financial Officer, as well as those
duties that may be assigned by the CEO from time to time.
2. TERM OF EMPLOYMENT. The Employee's employment with the Company will be
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for no specified term, and may be terminated by the Employee or the Company at
any time, for any reason, with or without cause, and neither the Employee nor
the Company shall have any further obligation or liability whatsoever under this
Employment Agreement to the other, except as may be specifically set forth
herein.
3. COMPENSATION. The Employee shall be compensated by the Company for his
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services as follows:
3.1 Base Salary. The Employee shall be paid a monthly Base Salary of
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$20,833.33 per month ($250,000.00 [Two Hundred and Fifty Thousand U.S. Dollars]
on an annualized basis), subject to applicable withholding, in accordance with
the Company's normal payroll procedures. The Employee's base salary shall be
reviewed on at least an annual basis and may be increased as appropriate. In
the event of such an increase, the new amount shall become the Employee's Base
Salary.
3.2 Benefits. The Employee shall have the right, on the same basis as
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other members of the Company's senior management, to participate in and receive
benefits under any of the Company's Employee Benefit Plans (broadly structured
in Attachment A), as such plans may be modified from time to time. The Employee
shall be entitled to the benefits afforded to other members of senior management
under the Company's vacation, holiday and business expense reimbursement
policies. The Employee will be entitled to five (5) weeks vacation. To the
extent the Employee is unable in the execution of his duties and
responsibilities to take the allotted (and any previously-carried-over) vacation
in any given year, the Employee will be eligible to roll-over up to five (5)
weeks of vacation annually.
3.3 Annual Incentive Bonus. By way of description and not limitation,
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the Employee shall be entitled to the benefits afforded to other members of
senior management under the Company's Bonus Program (broadly structured in
Attachment B regarding components based upon company performance and individual
performance in any given fiscal year). The Bonus Program shall be defined within
thirty (30) days of the Effective Date and which shall, in any case, contain a
target bonus amount of 50% of the Employee's base salary.
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The range of this annual incentive bonus shall be determined by senior
management as it formulates the mechanics of the Company's management incentive
compensation plan.
3.4 Hiring Bonus. In order to incent the Employee to join the Company
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and address certain forfeitures, including forfeited stock options, prompted by
leaving the Employee's current employer, and to reimburse the Employee for
certain relocation expenses, the Company will provide a one-time Hiring Bonus
award of $325,000.00 (Three Hundred and Twenty-Five Thousand U.S. Dollars),
payable within thirty (30) days of the Effective Date.
4. STOCK OPTIONS. The Employee shall be granted the option to purchase
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370,000 (Three Hundred and Seventy Thousand) shares of the Company's Common
stock (the "Stock Options"), at an exercise price per share equal to the fair
market value of the Company's Common Stock on the date of grant as determined by
the Board in its sole discretion. Such grant and determination shall be made no
later than thirty (30) days after the Effective Date. To the extent possible,
such Option will be an incentive stock option. The Stock Options shall vest
monthly at the rate of 1/48 per month; however there shall be a twelve (12)
month cliff vesting period, upon which the first 1/4th of the Stock Options
shall vest. Upon the termination of the Employee's employment in accordance with
the provision of Paragraph 6 below, the Stock Options shall vest as described in
such provisions. Except as provided herein and in Paragraph 6 below, the Stock
Options shall be subject to the terms of the Company's Stock Option Plan and the
Company's standard incentive and non-statutory Stock Option Purchase Agreements
(the "Standard Agreements" described in Attachment D), provided pursuant to the
Company's Stock Option Plan. The Employee will be permitted to exercise the
option in full prior to vesting in the underlying shares, subject to the
Company's right to repurchase any unvested shares (subject to Paragraph 6 below)
at the Employee's original cost upon his termination of employment, as provided
in the Standard Agreements. In addition, the Company shall permit the Employee
to pay the option exercise price with a full recourse loan (secured by the
shares acquired with the loan) at the lowest interest rate available to avoid
the imposition of imputed income under the tax laws to assist the Employee to
exercise the Stock Options. Such loan shall be repayable upon the earlier of:
(i) the fifth year anniversary of the Effective Date; (ii) the date six (6)
months after termination of the Employee's employment for any reason; or (iii)
the date twelve (12) months after the Employee is first eligible to sell shares
of the Company's stock that he holds following an initial public offering of the
Company's shares; provided however that in the event of termination of the
Employee Without Cause or the employee's Resignation for Good Reason, such loan
shall be repayable upon the earlier of the events stated in clauses (i) or (iii)
immediately preceding. Going forward, the Employee will be eligible to receive
additional Stock Options at amounts and exercise prices then prevailing, but
consistent with the proportional amounts of the original grant vis-a-vis other
senior manager's original grant allotments.
5. DEFINITIONS APPLICABLE TO TERMINATIONS. For the purposes of
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"terminations" as described in Paragraph 6, the following definitions shall
apply:
5.1 A "Change of Control" is defined as and shall be deemed to have
occurred if any of the following occurs with respect to the Company (except as
may occur with a re-incorporation of the Company in Delaware in advance of an
initial public offering of the Company's stock): (i) the direct or indirect sale
or exchange in a single or series of related
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transactions by the stockholders of the company of more than fifty percent (50%)
of the voting stock of the Company; (ii) a merger or consolidation in which the
Company is not the surviving party; (iii) the sale, exchange, or transfer of all
or substantially all of the assets of the Company; or (iv) a liquidation or
dissolution of the Company. The re-incorporation of the Company without a
material change in voting rights of the stockholders of the Company shall not be
deemed a Change in Control.
5.2 "Good Reason" shall be defined as, and shall be deemed to exist,
if any of the following conditions occur, provided that such conditions persist
for fifteen (15) business days after written notice to the Board from the
Employee and reasonable opportunity for the Company to cure: (i) the Company,
its successors or assigns decreases the Employee's Base Salary; (ii) the
Company, its successors or assigns makes a material, adverse change in the
Employee's title, authority, responsibilities or duties, as measured against the
Employee's title, authority, responsibilities or duties immediately prior to
such change (provided that the Company or its successor may provide an
equivalent position); (iii) the Company, its successors or assigns requires the
relocation of the Employee's work place to a location outside the San Francisco
Bay Area (i.e., outside Marin County, Contra Costa County, Alameda County, San
Francisco County, San Mateo County or Santa ▇▇▇▇▇ County); (iv) ▇▇▇▇▇ ▇▇▇▇
leaves the Company for reasons other than "Cause"; (v) covered above (vi) the
Company, its successors or assigns materially breaches any provision of this
Employment Agreement; or (vii) the Company fails to obtain the assumption of
this Employment Agreement by any successor or assign of the Company.
5.3 Termination for "Cause" is defined as a termination of the
Employee based upon: (i) theft of the Company's assets; (ii) falsification of
any employment applications; (ii) conviction of a felony or conviction of a
crime involving fraud or dishonesty; or (iii) improper and willful disclosure of
the Company's confidential or proprietary information that could materially harm
the Company.
6. BENEFITS UPON TERMINATION. The Employee agrees that his employment may
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be terminated by the Company at any time, for any reason, with or without cause,
and he shall be entitled as his sole remedy and compensation only the
compensation provided, below, in this Section 6. In the event of the termination
of the Employee's employment by the Company for any reasons set forth below, he
shall be entitled to the following:
6.1 Termination for "Cause". If the Employee's employment is
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terminated by the Company for "Cause" as described above, the Employee shall be
entitled to no compensation or benefits from the Company other than those under
Paragraph 3 earned up until such termination and, in the case of the Stock
Options under Paragraph 4, shares vested through the date of termination.
6.2 Voluntary Resignation. In the event of the Employee's voluntary
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resignation from employment with the Company, other than for Good Reason as
described above, the Employee shall be entitled to no compensation or benefits
from the Company other than those under Paragraph 3, earned up until such
termination and, in the case of the Stock Options under Paragraph 4, shares
vested through the date of his resignation.
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6.3 Death or Disability. In the event that the Employee's employment
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terminates as a result of his death or continued disability for ninety (90) days
("disability" being defined as the inability to perform specifically the
essential functions of the Employee's position as Chief Financial Officer), the
Employee shall be entitled to the following as of the date of death or
disability.
(a) all accrued compensation and benefits earned through such
date;
(b) the removal of any "cliff date" in calculating the number of
Stock Options vested upon the date of death or disability.
(c) an immediate vesting of all Stock Options granted and
unvested as of the date of death or disability. These Stock Options would be
then deemed immediately exercisable and remain exercisable for the duration of
the exercise period originally granted under the Company's Stock Option Plan.
6.4 Termination Without Cause and/or Resignation for Good Reason. If
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the Employee's employment is terminated by the Company without Cause, or if the
Employee resigns as an Employee of the Company for Good Reason (provided that
the underlying conditions persist for fifteen (15) business days after written
notice to the Company), then the Employee shall be entitled, on such date, to
all of the following:
(a) all accrued compensation, benefits and vesting earned through
the date of termination or resignation;
(b) a lump-sum severance payment equal to twelve months of the
Employee's base salary and target incentive bonus, less applicable withholding,
payable immediately.
(c) the removal of any "cliff date" in calculating the number of
Stock Options vested upon such date; and
(d) The greater of: an immediate six (6) month acceleration in
the vesting schedule, or fifty percent (50%) of any unvested Stock Options,
shall be deemed to vest immediately on the date of termination or resignation.
These vested, and all previously vested and unexercised, Stock Options would be
then deemed immediately exercisable and remain exercisable for the duration of
the exercise period originally granted under the Company's Stock Option Plan.
7. EMPLOYEE INVENTIONS AND PROPRIETARY RIGHTS ASSIGNMENT AGREEMENT. The
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Employee agrees to abide by the terms and conditions of the Company's standard
Employee Inventions and Proprietary Rights Assignment Agreement (as described in
Attachment E).
8. NON-SOLICITATION. The Employee agrees that for a period of one (1) year
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after the date of the termination of his employment for any reason, he shall
not, either directly or indirectly; (i) solicit the services, or attempt to
solicit the services, of any employee of the Company to any other person or
entity; or (ii) solicit or otherwise encourage any supplier or
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other business contract of the Company to withdraw, curtail or cancel their
business with the Company.
9. INDEMNIFICATION. The Company agrees to make the Employee a party to its
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standard form of indemnification agreement (as described in Attachment F) as may
be signed by the Company's other officers and directors from time to time. The
Employee will be covered under the Company-provided Directors' and Officers'
Liability Insurance Policies, which protections shall be commensurate with the
duties, responsibilities and risks of the Chief Financial Officer position.
10. DISPUTE RESOLUTION. In the event of any dispute or claim relating to or
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arising out of this Employment Agreement (including, but not limited to, and
claims of breach of contract, wrongful termination or age, sex, race or other
discrimination), the Employee and the Company agree that all such disputes shall
be fully and finally resolved by binding arbitration conducted by the American
Arbitration Association in Santa ▇▇▇▇▇ County, California in accordance with its
National Employment Dispute Resolution rules, as those rules are currently in
effect (and not as they may be modified in the future). The Employee
acknowledges that by accepting this arbitration provision he is waiving any
right to a jury trial in the event of such dispute. Provided, however, that this
arbitration provision shall not apply to any disputes or claims relating to or
arising out of the misuse or misappropriation of trade secrets or proprietary
information.
11. ATTORNEY'S FEES. In the event that the Employee must bring action
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against the Company to remedy breaches of the above Agreement, or to enforce any
right arising out of this Agreement, the following shall apply: (i) if the
action brought by the Employee fails to win the decision in the arbitration, the
Company shall not be liable to reimburse any costs incurred by the Employee;
(ii) if the action brought by the Employee prevails in the arbitration, the
Company shall be liable to reimburse the Employee his incurred attorney's fees,
arbitration costs and/or other costs associated with the action or actions.
12. INTERPRETATION. The Employee and the Company agree that this Employment
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Agreement shall be interpreted in accordance with and governed by the laws of
the State of California.
13. SUCCESSORS AND ASSIGNS. This Employment Agreement shall inure to the
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benefit of and be binding upon the Company and its successors and assigns. In
view of the personal nature of the services to be performed under this
Employment Agreement by the Employee, he shall not have the right to assign or
transfer any of his rights, obligations or benefits under the Employment
Agreement, except as otherwise noted herein. This agreement may be assigned to
the Company's successor without consent of the Employee (understanding Change in
Control provisions still apply).
14. ENTIRE AGREEMENT. This Employment Agreement constitutes the entire
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employment agreement between the Employee and the Company regarding the terms
and conditions of his employment with the Company. To the extent that there is
any inconsistency between this Employment Agreement and any other agreement
between The Employee and the Company, the terms of this Employment Agreement
will govern. This Employment Agreement
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supersedes all prior negotiations, representations or agreements between the
Employee and the Company, whether written or oral, concerning the Employee's
employment by the Company.
15. VALIDITY. If any one or more of the provisions (or any part thereof) of
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this Employment Agreement shall be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
(or any part thereof) shall not in any way be affected or impaired thereby.
16. MODIFICATION. This Employment Agreement and its Addenda may only be
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modified or amended by a supplemental written agreement signed by the Employee
and the Company.
17. COUNTERPARTS. This Employment Agreement may be executed in any number
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of counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
IN WITNESS WHEREOF, the parties have executed this Employment Agreement as
of the date and year written below.
Date: December 10, 1999 TELOCITY, INC.
By: ▇▇▇▇ ▇. ▇▇▇▇
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Its: President - CEO
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Date: December 10, 1999 /S/ ▇▇▇▇▇▇ ▇▇▇▇▇
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EMPLOYEE
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Addendum to Employment Agreement
This is an addendum to the employment Agreement between Telocity Delaware,
Inc. (the "Company") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇. (the "Employee") dated December
10, 1999 (the "Employment Agreement"). In consideration for relocating to the
Cupertino area to work for the Company, the Company agrees to pay Employee a
housing subsidy allowance of $2,083.34 twice-a-month, less all applicable
withholding, payable on the Company's regular payroll dates.
These housing allowance payments will commence upon the Employee providing
the Company documentary evidence that he has purchased a house in the area; a
date anticipated to be on, or about, August 18th, 2000.
The Employee acknowledges that this payment is intended to assist in
offsetting the relative high cost of housing in the San Francisco Bay/Silicon
Valley Area and is payable only for as long as the Employee is employed by the
Company or, in the case of a termination Without Cause or resignation for Good
Reason, for one year following such termination form the Company.
The parties agree that, in the event of any dispute arising out of
Employee's employment with the company, prior to taking any formal step toward
litigation or arbitration of the dispute, they will in good faith prepare for
and participate in a one-day mediation of the dispute with a mutually agreed-
upon mediator.
Unless otherwise modified herein, all of the terms and conditions of the
Employment Agreement remain in full force and effect.
Company Employee
____________________________________ ________________________________________
Signature Signature
Name:
Title:
Attachment: HUD Closing Statement
Alliance Title
August 18, 2000
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇. and ▇▇▇▇▇▇ ▇ ▇▇▇▇▇
Escrow No: 11006777-008-SF
Property Address: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear Mr. and ▇▇▇. ▇▇▇▇▇,
We are pleased to inform you that the above referenced escrow transaction has
been closed. The following documentation has been provided for your disposition.
. Refund in the amount of $49,088.39
. Closing Statement and/or RESPA
. Original Withholding Exemption Certificate (California Form 590)
Title Insurance Policy will follow under separate cover.
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Any recorded documents to which you may be entitled will be mailed to you
directly from the County Recorder's Office, under separate cover.
If, in the future, you sell of obtain a loan on this property, please ask your
broker or agent to contact your team at Alliance Title Company regarding our
short term rates, and other services available for you. We cannot close this
letter without expressing to you our sincere appreciation for your business.
Thank you,
Alliance Title Company
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Escrow Officer
AMENDMENT TO EMPLOYMENT AGREEMENT
---------------------------------
This Amendment is made between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇. ("Employee") and
Telocity Delaware, Inc. (the "Company"), effective as of November 29, 2000.
I.
RECITALS
A. Employee and the Company are parties to an Employment Agreement, as
amended from time to time (the "Agreement").
B. The Board of Directors of the Company has determined that it is in the
best interests of the Company and its stockholders to ensure that the Company
will have the continued service of Employee and dedication of Employee to the
achievement of the Company's objectives through at least April 1, 2001.
C. Employee enters into this Amendment and makes each of the
representations and warranties set forth herein in order to obtain the benefits
conferred by this Amendment.
II.
AGREEMENT
In consideration of the mutual covenants contained herein, it is hereby
agreed by and between the parties hereto that the Agreement shall be amended as
follows:
A. Termination Without Cause and/or Resignation for Good Reason. A new
Clause (v) is hereby added to subparagraph D of Paragraph 6 of the Agreement as
follows:
(v) With respect to each Stock Option granted to Employee on or prior
to September 29, 2000, the phrase "fifty percent (50%)" appearing in the
foregoing clause (iv) of this subparagraph D shall be deemed deleted and
replaced with the phrase "seventy-five percent (75%)".
B. Irrevocable Letter of Credit. A new subparagraph E is hereby added to
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Paragraph 3 of the Agreement as follows:
E. One-Time Incentive Bonus. To provide incentive to the Employee to
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devote his full energies and resources to realizing the Company's
objectives and foregoing the consideration of other market opportunities
the Company agrees to provide the Employee with an irrevocable letter of
credit issued as of the effective date of this Amendment, November 29,
2000, in the amount of Seven Hundred and Fifty Thousand Dollars
($750,000.00), payable on the "Bonus Payment Date" provided that no
"Divesting Event" has occurred as of such date, and with an expiry date of
no sooner than April 6, 2001. (The $750,000.00 amount discussed in the
immediately preceding sentence shall be referred to in this Amendment as
the "One-Time Incentive Bonus.") For purposes of this Paragraph 3.E, "Bonus
Payment Date" shall mean the earlier of
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(i) April 1, 2001; (ii) a date upon which the Employee's employment is
terminated by the Company without Cause such that the Employee is entitled
to all compensation and benefits provided in Paragraph 6.D of the
Agreement; or (iii) a date upon which the Employee resigns his employment
with the Company for Good Reason such that the Employee is entitled to all
compensation and benefits provided in Paragraph 6.D of the Agreement. For
purposes of this Paragraph 3.E, "Divesting Event" shall mean any of the
following: (i) the Employee's employment is terminated for Cause prior to
April 1, 2001; (ii) the Employee voluntarily resigns his employment with
the Company other than for Good Reason prior to April 1, 2001; (iii) if at
any time after execution of this Agreement and prior to April 1, 2001 the
Employee conveys to a third party or an authorized recruiter for such third
party a genuine interest in a position of employment for himself with such
third party; or (iv) if at any time after execution of this Amendment and
prior to April 1, 2001 the Employee willfully fails to provide notice via
voice mail to ▇▇▇▇▇ ▇▇▇▇ of Employee's receipt of any inquiry from a third
party or an authorized recruiter for such third party regarding Employee's
interest in a position of employment for himself with such third party.
Prior to or concurrently with the execution of this Amendment, the Company
shall establish an irrevocable letter of credit, with a bank selected by
the Company to provide for the payment to Employee of $750,000.00 on the
terms and conditions of this Paragraph 3.E. The letter of credit is
provided by tile Company as security for the One-Time Incentive Bonus and
the Employee retains all rights and full recourse against the Company if
Employee is not paid the full amount of the One-Time Incentive Bonus under
the letter of credit. Notwithstanding the provisions of this Paragraph 3.E,
the Company shall take all commercially reasonable steps as soon as
possible upon the effective date of the Amendment to the Agreement to
arrange for and obtain all amendment to the letter of credit discussed in
this Paragraph 3.E, extending the expiration date of such letter of credit
to April 30, 2001.
C. Insurance Policy. A new subparagraph F is hereby added to Paragraph 3
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of the Agreement as follows:
F. Insurance Policy. Upon the effective date and continuing until
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April , 2001, provided that no Divesting Event has occurred, Employee shall
be entitled to participate in a life insurance and continued disability
policy, provided at the Company's expense, with coverage in the amount of
Seven Hundred and Fifty Thousand Dollars ($750,000.00) payable to Employee
or his beneficiaries upon death or continued disability, as the latter term
is defined in the Employment Agreement.
D. No Other Modification. Except as modified by this Amendment, the
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Agreement shall remain in full force and effect.
III.REPRESENTATIONS, WARRANTIES &
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ACKNOWLEDGMENTS
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In agreeing to provide new benefits to employees, the Company expects to
make an investment in continued commitment, effort, and effectiveness. In doing
so, the Company must rely on the employee's confirmation that there exists no
disagreement or dispute which has not
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yet been expressed to the Company. Accordingly, Employee represents, warrant and
acknowledges that:
A. Except with respect to facts that Employee has already specifically
described in writing under the complaint procedures set forth in the Company's
Employment Manual, to his knowledge there are no causes, facts, things, acts or
omissions existing upon which Employee alone would base a material disagreement
of any kind with the Company, including but not limited to such facts, which up
to the execution of this Amendment alone might form the basis for a resignation
for Good Reason, a claim for any kind for harassment, breach of contract,
constructive termination, misrepresentation, race discrimination, age
discrimination, gender discrimination, or any other improper or illegal
discrimination or employment-related proceeding.
B. A court will conclusively presume the accuracy of the above
representations to be true under California Evidence Code (S) 622, which
presumes the accuracy of facts recited in a signed writing. In entering this
Amendment, Company will rely on the accuracy of the above (S) recited facts,
meaning that under California Evidence Code (S) 623, Employee may not later
contradict them. Nevertheless, nothing in this paragraph would preclude evidence
of causes, facts, things, acts or omissions that occur (or of which Employee
becomes aware) after Employee signs this agreement .
IN WITNESS WHEREOF, each of the parties has signed this Amendment, in the
case of the Company by its duly authorized officer, as of the day and year first
above written.
Telocity Delaware, Inc.
By: _______________________________ ________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: ____________________________
Date & Time: ______________________ Date & Time: ___________________________
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FURTHER AMENDMENT TO EMPLOYMENT AGREEMENT
-----------------------------------------
This is a Further Amendment, dated December 17, 2000, to the Employment
Agreement between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇. ("Employee") and Telocity Delaware, Inc.
(the "Company"), as amended from time to time, including by the Amendment to
Employment Agreement dated November 29, 2000 (the Employment Agreement between
the parties, as amended through November 29, 2000, shall be referred to herein
as the "Agreement").
I. RECITALS
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A. Employee and the Company are parties to the Agreement;
B. Employee and the Company desire to correct certain terms in the
Agreement; and
C. All capitalized terms used herein and not otherwise defined have the
meanings set forth in the Agreement.
II. AGREEMENT
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In consideration of the mutual covenants contained herein, it is hereby
agreed by and between the parties hereto that the Agreement shall be amended as
follows:
A. Irrevocable Letter of Credit. SubParagraph E of Paragraph 3 of the
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Agreement is hereby amended and restated in its entirety as follows:
E. One-Time Incentive Bonus. To provide incentive to the Employee to
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devote his full energies and resources to realize the Company's objectives
and foregoing the consideration of other market opportunities the Company
agrees to provide the Employee with an irrevocable letter of credit in the
amount of Seven Hundred and Fifty Thousand dollars ($750,000.00), payable
on the "Incentive Payment Date" provided that no "Divesting Event" has
occurred as of such date, and with an expiry date of no sooner than April
6, 2001. (The $750,000.00 amount discussed in the immediately preceding
sentence shall be referred to as the "One-Time Incentive Bonus.") For
purposes of this Paragraph 3.E, "Incentive Payment Date" shall mean the
earlier of (i) April 1, 2001; (ii) a date upon which the Employee's
employment is terminated by the Company without Cause such that the
Employee is entitled to all compensation and benefits provided in Paragraph
6.D of the Agreement; or (iii) a date upon which the Employee resigns his
employment with the Company for Good Reason such that the Employee is
entitled to all compensation and benefits provided in Paragraph 6.D of the
Agreement. For purposes of this Paragraph 3.E, "Divesting Event" shall
mean any of the following: (i) the Employee's employment is terminated for
Cause prior to April 1, 2001; (ii) the Employee voluntarily resigns his
employment with the Company other than for Good Reason prior to April 1,
2001; (iii) if at any time after execution of the Amendment to Employment
Agreement dated November 29, 2000 and prior to
April 1, 2001 the Employee conveys to a third party or an authorized
recruiter for such third party a genuine interest in a position of
employment for himself with such third party; or (iv) if at any time after
execution of the Amendment to Employment Agreement dated November 29, 2000
and prior to April 1, 2001 the Employee willfully fails to provide notice
via voicemail to ▇▇▇▇▇ ▇▇▇▇ of Employee's receipt of any inquiry from a
third party or an authorized recruiter for such third party regarding
Employee's interest in a position of employment for himself with such third
party. Prior to or concurrently with the execution of the Amendment to
Employment Agreement dated November 29, 2000, the Company shall establish
an irrevocable letter of credit, with a bank selected by the Company to
provide for the payment to Employee of $750,000.00 on the terms and
conditions of this Paragraph 3.E. The letter of credit is provided by the
Company as security for the One-Time Incentive Bonus and the Employee
retains all rights and full recourse against the Company if Employee is not
paid the full amount of the One-Time Incentive Bonus under the letter of
credit. Notwithstanding the provisions of this Paragraph 3.E, the Company
shall take all commercially reasonable steps as soon as possible upon the
effective date of the Amendment to Employment Agreement dated November 29,
2000 to arrange for and obtain an amendment to the letter of credit
discussed in this Paragraph 3.E, extending the expiration date of such
letter of credit to April 30, 2001.
C. No Other Modification. Except as modified by this Further
---------------------
Amendment, the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has signed this Further Amendment,
in the case of the Company by its duly authorized officer, as of the day and
year first above written.
Telocity Delaware, Inc.
By: ▇▇▇▇▇ ▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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Title: CEO ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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Date & Time: December 10, 1999 Date & Time: December 10, 1999
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