Employment Agreement with Mr. DeBlasio

First Amendment to DeBlasio Agreement

Transition Agreement with Mr. DeBlasio



EX-10.1 2 ex10-1.htm EXHIBIT 10.1


Exhibit 10.1

 

Internap Network Services Corporation

250 Williams Street

Atlanta, GA  30303


January 16, 2009




Eric Cooney

4535 E Conway Dr NW

Atlanta, GA 30327


Dear Eric:


On behalf of Internap Network Services Corporation, subject to satisfactory completion of reference checks and the RRA assessment process, I am pleased to offer you the position of President and Chief Executive Officer.  Additionally, you would be appointed as a director of Internap.  This letter outlines the terms of this offer, which assumes that you would commence work on February 1, 2009.

 

Your annual base salary would be $600,000, payable in accordance with Internap’s payroll practices, and would be reviewed annually for possible increases.  Your annual target bonus would be 100% of your annual base salary, commencing your start date.  The performance criteria underlying the bonus for 2009 would be established by Internap’s Board of Directors no later than March 31, 2009.  Your bonus would be structured so that the maximum bonus opportunity is twice the target bonus.

 

You would receive a cash signing bonus of $300,000, payable upon your commencement of work.  However, if your employment terminates on or prior to March 1, 2011, under the circumstances described in Section 1.3 of the Employment Security Plan, which is discussed below, you will be obligated to reimburse Internap for 50% of the signing bonus.  All compensation is subject to customary withholdings and practices of Internap.

 

Upon commencement of your work, you will be granted an option to purchase 600,000 shares of Internap common stock at an exercise price equal to the closing price on the day of commencement.  The vesting schedule for these options will be 25% on the first anniversary of the grant date and in 36 equal monthly installments thereafter.


You will also receive a new hire grant of 300,000 shares of restricted stock. These restricted shares will vest in four equal annual increments. Additionally, on the first anniversary of your commencement date, you will receive a grant of 200,000 shares of restricted stock that will vest in four equal annual increments from the date of grant.  Finally, on the second anniversary of your commencement date, you will be granted an additional 200,000 shares of restricted stock that will vest in four annual increments from the date of grant.   Vesting of restricted stock is subject to the surrender of shares for the payment of applicable taxes.


You would accrue 20 days of vacation/sick leave annually as well as three personal days each year.  You would have the right to carry over any unused vacation subject to the maximum accrual under the Company policy.  In addition, you would be eligible to participate in the health, welfare and other benefit plans made available to Internap’s executive officers.

 







 

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You would receive the benefit of Internap’s Employment Security Plan, which has been provided to you.  Your “Joinder Agreement” to the Employment Security Plan would provide for an “Applicable Multiple” equal to “one” in the event of a “Qualifying Termination” other than during a “Protected Period,” and “2.5” in the event of a “Qualifying Termination” during a “Protected Period” (essentially, in the event of a change-in-control related termination).  The Employment Security Plan covers all of our other executive officers and, we believe, provides eminently fair and market-based benefits in the event of a termination.  The Employment Security Plan is the exclusive source of your rights in the event that your employment is terminated.

 

You will be subject to Internap’s stock retention guidelines, which generally require that you hold 50% of the shares that you receive from Internap, net after taxes and transaction costs, for five years from the date of their acquisition.

 

Your continued status as a director of Internap is subject to periodic stockholder approval and such other limitations as might apply to directors generally.

 

Lastly, your employment by Internap will be “at will.”  Both you and Internap will have the right to terminate the employment relationship at any time with or without cause, and with or without advance notice.  In the event that your employment with the company is terminated for any reason, you agree to immediately resign as a director of the Company upon request.  We are excited about the future of Internap and are confident in your ability to lead Internap to the next level of its development.  We hope that you will accept this offer and look forward to a long and prosperous relationship with you.

 

This offer is made on the basis of your starting your employment on February 1, 2009, or in consideration of your transition from your current employer, a date mutually agreed upon by February 1, 2009.  If this offer is acceptable to you, please indicate your acceptance by signing a copy of this letter and returning it to me.

 

                        Sincerely yours,


                        /s/ Charlie Coe


                        Charlie Coe

                        On behalf of the Board of Directors


Accepted:


/s/ J. Eric Cooney                             

 




EX-99.1 2 ex99-1.htm EXHIBIT 99.1

 


 

Exhibit 99.1


 

EMPLOYMENT AGREEMENT

 

 

Employment Agreement (this "Agreement") dated as of July 10, 2007, by and between Internap Network Services Corporation, a Delaware corporation with its principal office in Atlanta, Georgia (the "Company"), and James DeBlasio ("Executive") (collectively the "Parties").

 

1. Position and Duties. Executive shall serve as the President and Chief Executive Officer for the Company, with such duties, authorities and responsibilities as are commensurate with such position. Executive shall report to the Company's Board of Directors.

 

2. Base Salary. Executive shall receive an annual base salary of $425,000 ("Base Salary"). Payment of Base Salary shall be subject to standard payroll tax withholdings and deductions. Executive's Base Salary shall be paid periodically in accordance with the Company's standard payroll practices for senior executives. Executive's Base Salary may be increased or decreased from time to time by the Company's Board of Directors or the Compensation Committee of such Board of Directors (in either case, the "Board") in their sole and absolute discretion.

 

3. Performance-Based Bonus. The Executive will be eligible to participate in the Company's annual incentive plan ("Bonus") for senior executives, and performance metrics for and target amount of the Bonus shall be established on or before March 31 of the year to which the Bonus relates. The Board in their sole and reasonable discretion, shall determine, on or before March 31 of the year in which the Bonus would be payable, whether a Bonus is payable and, if so, the amount of such Bonus. Unless otherwise determined by the Board, all Bonus payments shall be made on the Company's first regular payroll date following such determination. To be eligible for a Bonus, Executive must be continuously employed by the Company through the date on which the Bonus is paid. Executive recognizes and agrees that: (a) the Company may in its sole discretion and with reasonable notice to Executive determine that any Bonus, if payable, may be paid in whole or in part in the Company's common stock or other equity securities, including restricted stock and stock options; and (b) the Company may in its sole discretion suspend or discontinue any bonus program at any time without any liability on the part of the Company.

 

4. Equity Compensation. The Board, in their sole discretion, may award equity-based compensation to Executive on terms, in amounts and subject to performance goals as determined by the Board (any such equity or equity-based compensation being referred to herein as "Equity Compensation"). All Equity Compensation are governed by the terms and conditions of the relevant equity incentive plan(s) and related incentive agreement(s).

 

5. Employee Benefits. Executive shall be entitled to participate in all employee benefit, welfare and other plans and programs generally applicable to senior executives of the Company. Except as provided herein, the Company reserves the right to modify or terminate its employee benefit, welfare and other plans and programs from time to time, as it deems necessary and shall be entitled to terminate any such plans in its sole and absolute discretion so long as Executive continues to receive healthcare and life insurance coverages that are comparable to other similarly situated employees.

 

6. Vacation. Executive shall accrue twenty (20) days of combined vacation/sick leave annually. Executive also shall receive three (3) personal days each year. Executive shall have the right to carry over unused vacation from any one-year period to the next subsequent one-year period.

 

7. Nature of Employment. Executive's employment with the Company shall be at-will. Both Executive and the Company shall have the right to terminate the employment relationship at

any time, with or without cause, and with or without advance notice. In the event that Executive’s employment relationship terminates for any reason, upon request of the Company Executive agrees to immediately resign as a director of the Company.

 

 


 

 

 

8. Severance Payments. If Executive’s employment is terminated by the Company without Cause (as defined below), Executive shall receive a cash severance payment equal to one and one-half (1.5) times Executive's then-current Base Salary. Payment of such severance amount shall be subject to standard payroll tax withholdings and deductions. In addition to the severance benefits provided above, if Executive’s employment is terminated without Cause, all of Executive's unvested Equity Compensation shall lapse and expire, and all of Executive's vested Equity Compensation shall remain exercisable until the earlier of three months after the date of termination and the original expiration date thereof. Notwithstanding the immediately preceding sentence, Executive shall not be entitled to any benefits or rights under this Section 8 if Executive also is eligible for payments and/or benefits under Section 9 hereof.

 

If Executive dies while employed pursuant to this Agreement, all of Executive’s unvested Equity Compensation that would, had he not have died, have become vested within twelve months after the date of his death (assuming fulfillment of any performance criteria and his continued employment by the Company) shall become vested, free of restrictions (other than those imposed by law) and immediately exercisable for a period ending on the earlier of twelve months after the date of death and the original expiration date thereof.

 

9. Change in Control Payments and Acceleration. If a Change in Control occurs during the course of Executive’s employment, all of Executive's unvested Equity Compensation shall become immediately vested, free of restrictions (other than those imposed by law) and immediately exercisable for the remaining term of the relevant grant or award. If Executive's employment is terminated by the Company without Cause or Executive terminates his employment for Good Reason, in either case within 12 months after a Change in Control, then (i) the Company shall pay Executive a cash severance payment equal to two (2) times the sum of Executive's then-current Base Salary plus the greater of (A) Executive’s target Bonus for the year in which the termination occurs and (B) Executive’s average Bonus during the prior two completed years (as a percentage of Executive’s Base Salary upon which his Bonus awards were calculated) multiplied by Executive’s then-current Base Salary, and (ii) all of Executive's unvested Equity Compensation shall become immediately vested, free of restrictions (other than those imposed by law) and immediately exercisable for the remaining term of the relevant grant or award.

 

If Executive’s employment is terminated pursuant to this Section 9, Executive will continue to receive the healthcare and life insurance coverages in effect on his date of termination for twenty-four (24) months after the date of termination pursuant to this Section 9 just as if he had remained an active employee of the Company, subject to Executive paying the customary employee portion of such coverages, provided that if the Company cannot continue to cover Executive under its plans, the Company will separately provide Executive with comparable coverages or pay Executive in a lump sum in advance the costs of such coverages.

 

For purposes of this Agreement, "Change in Control" shall mean the happening of any of the following events:

 

(i) An acquisition by any individual, entity or group (within the meaning of Section 13 (d) (3) or 14 (d) (2) of the Exchange Act) (an "Entity") of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either (A) the then outstanding shares of common stock of the Company (the Outstanding Company Common Stock") or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities"); excluding, however, the following: (1) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Company, (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or (4) any acquisition by any corporation pursuant to a transaction which complies with clauses (A), (B) and (C) of subsection (iii) of this Section;

 

 

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(ii) A change in the composition of the Board such that the individuals who, as of the date hereof, constitute the Board (such Board shall be hereinafter referred to as the "Incumbent Board"), cease for any reason to constitute at least a majority of the Board; provided, however, that for purposes of this definition, any individual who becomes a member of the Board subsequent to the date hereof, whose election, or nomination for election, by the Company's stockholders was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso), shall be considered as though such individual were a member of the Incumbent Board; and provided, further however, that any such individual whose initial assumption of office occurs as a result of or in connection with either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of an Entity other than the Board shall not be so considered as a member of the Incumbent Board;

 

(iii) The approval by the stockholders of the Company of a merger, reorganization or consolidation or sale or other disposition of all or substantially all of the assets of the Company (each, a "Corporate Transaction") or, if consummation of such Corporate Transaction is subject, at the time of such approval by stockholders, to the consent of any government or governmental agency, the obtaining of such consent (either explicitly or implicitly by consummation); excluding however, such a Corporate Transaction pursuant to which (A) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding shares of common stock, and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a corporation or other Person which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries (a "Parent Company")) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (B) no Entity (other than the Company, any employee benefit plan (or related trust) of the Company, such corporation resulting from such Corporate Transaction or, if reference was made to equity ownership of any Parent Company for purposes of determining whether clause (A) above is satisfied in connection with the applicable Corporate Transaction, such Parent Company) will beneficially own, directly or indirectly, 50% or more of, respectively, the outstanding shares of common stock of the corporation resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of such corporation entitled to vote generally in the election of directors unless such ownership resulted solely from ownership of securities of the Company prior to the Corporate Transaction, and (C) individuals who were members of the Incumbent Board will immediately after the consummation of the Corporate Transaction constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction (or, if reference was made to equity ownership of any Parent Company for purposes of determining whether clause (A) above is satisfied in connection with the applicable Corporate Transaction, of the Parent Company); or

 

(iv) The approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

 

 

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For purposes of this Agreement, "Cause" shall mean:

 

(i) Executive's conviction (including a plea of guilty or nolo contendre) of a crime involving theft, fraud, dishonesty or moral turpitude;

 

(ii) material violation by Executive of the Company's Code of Conduct or other material policies;

 

(iii) gross omission or gross dereliction of any statutory, common law or other duty of loyalty to the Company or any of its affiliates; or

 

 

(iv) repeated failure to carry out the duties of Executive's position despite specific instructions to do so.

 

 

 

Executive shall not be deemed to have been terminated for “Cause” until there shall have been delivered to him written notice specifying the basis for such termination.

 

For purposes of this Agreement, Good Reason shall mean any one of the following events which occurs without Executive's written consent: (i) any significant diminution in Executive's title, authority or responsibility, including any change in the reporting relationship between Executive and the Board; (ii) any significant reduction in Executive's then current total compensation from that compensation paid in the prior fiscal year; (iii) a change of more than fifty (50) miles from Executive's permanent workplace without Executive's consent; or (iv) any material breach of this Agreement by the Company.

 

10. Certain Tax Matters. If any cash compensation payment, employee benefits or acceleration of vesting of stock options or other stock awards Executive would receive in connection with a Change in Control ("Payment") would (i) constitute a "parachute payment" within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the "Code"), and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the "Excise Tax"), then such Payment shall be equal to the Reduced Amount. The "Reduced Amount" shall be either (x) the largest portion of the Payment that would result in no portion of the Payment being subject to the Excise Tax or (y) the largest portion, up to and including the total, of the Payment, whichever amount, after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in Executive's receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in payments or benefits constituting "parachute payments" is necessary so that the Payment equals the Reduced Amount, reduction shall occur in the following order unless Executive elects in writing a different order: reduction of cash payments; reduction of employee benefits; and cancellation of accelerated vesting of stock awards. In the event that acceleration of vesting of stock award compensation is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant of Executive's stock awards unless Executive elects in writing a different order for cancellation. The accounting firm engaged by the Company for general audit purposes as of the day prior to the effective date of the Change in Control shall perform the foregoing calculations. If the accounting firm so engaged by the Company is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, the Company shall appoint a nationally recognized accounting firm to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder. The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and Executive within fifteen (15) calendar days after the date on which Executive's right to a Payment arises (if requested at that time by the Company or Executive) or at such other time as requested by the Company or Executive. If the accounting firm determines that no Excise Tax is payable with respect to a Payment, either before or after the application of the Reduced Amount, it shall furnish the Company and Executive with an opinion reasonably acceptable to Executive that no Excise Tax will be imposed with respect to such Payment. Any good faith determination of the accounting firm made hereunder shall be final, binding and conclusive upon the Company and Executive.

 

 

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It is expressly contemplated by the Parties that this Agreement will conform to, and be interpreted to comply with, Section 409A of the Internal Revenue Code, as amended (the “Code”). If Company determines that any benefit payable to Executive fails to satisfy the distribution requirement of Section 409A(a)(2)(A) of the Code, as a result of Section 409A(a)(2)(B)(i) of the Code, then the payment schedule will be modified as follows: If the acceleration of a benefit that is payable but not yet due will avoid application of Section 409(a)(1) of the Code, then the Company will accelerate the payment of the benefit to the minimum extent necessary so that the benefit is not subject to the provisions of Section 409A(a)(1) of the Code. If acceleration of the benefit would not avoid the application of Section 409A(a)(1) of the Code, however, then the Company will delay the benefit to the minimum extent necessary(but not in excess of seven months) so that the benefit is not subject to the provisions of Section 409A(a)(1) of the Code. If any payments are delayed as a result of the previous sentence, all such delayed payments shall become payable in a lump sum on the first day they can be paid following the date of termination of employment. Thereafter, payments will resume in accordance with the payment schedule set forth in this Agreement.

 

All payments under this Agreement, including equity compensation, shall be subject to standard payroll tax withholdings and deductions.

 

11. Release. Notwithstanding anything to the contrary contained in this Agreement, upon termination of Executive's employment, unless Executive shall have executed and provided the Company with an effective release in the form attached as Appendix A by which Executive releases the Company and related persons from any and all claims of any kind, Executive shall not receive any severance payments or benefits provided under this Agreement and no Equity Compensation shall vest or otherwise be exercisable.

 

12. Confidentiality. Executive agrees that information not generally known to the public to which he will be exposed as a result of his employment by the Company is confidential information that belongs to the Company. This includes information developed by Executive, alone or with others, or entrusted to the Company by its customers or others. The Company's confidential information includes, without limitation, information relating to the Company's trade secrets, research and development, inventions, know-how, software, procedures, accounting, marketing, sales, creative and marketing strategies, employee salaries and compensation, and the identities of customers and active prospects to the extent not publicly disclosed (collectively, "Confidential Information"). During the No Disclosure Term (as defined below), Executive will hold the Company's Confidential Information in strict confidence, and not disclose or use it except as authorized by the Company and for the Company's benefit.

 

For purposes of this Agreement, “No Disclosure Term” shall mean during the time period Executive is employed by the Company and for a period of two (2) years after Executive’s employment is terminated.

 

Executive further acknowledges and agrees that in order to enable the Company to perform services for its customers or clients, such customers or clients may furnish to the Company certain Confidential Information, that the goodwill afforded to the Company depends upon the Company and its employees preserving the confidentiality of such information, and that such information shall be treated as Confidential Information of the Company for all purposes under this Agreement.

 

13. Non-Competition. Executive recognizes and agrees that the Company has many substantial, legitimate business interests that can be protected only by his agreement not to compete with Internap under certain circumstances. These interests include, without limitation

 

 

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and on a national basis, Internap's contacts and relationships with its clients and active prospects, Internap's reputation and goodwill in the industry, and Internap's rights in its Confidential Information. Therefore, Executive agrees that during the term of his employment with the Company and for a period of one (1) year after his employment ends for any reason whatsoever and except as provided in the paragraph immediately following, he shall not, voluntarily or involuntarily, directly or indirectly, on his own behalf or on the behalf of another, whether as an employee, contractor, consultant, director or agent or in another capacity, perform within the Restricted Territory (as defined herein) any services which are the same as or similar to those he performed for the Company, in competition with the Business (as defined herein). For purposes of this Agreement, “Business” shall mean the business of the Company and its subsidiaries in providing (i) managed high performance Internet connectivity, (ii) hosting or collocation services, (iii) virtual private network services, or (iv) content distribution network services. For purposes of this Agreement, “Restricted Territory” shall mean the states within the United States in which, as of the date hereof, the Company or its subsidiaries has customers.

 

Executive also agrees that during his employment with the Company and for a period of two (2) years after such employment ends for any reason whatsoever, he shall not directly or indirectly solicit or attempt to solicit any employee of the Company or any of its subsidiaries with whom Executive had material contact during the last two (2) years of Executive’s employment to terminate or resign such employee’s employment with the Company or any of its subsidiaries.

 

14. Equitable Relief. Executive acknowledges that the breach or threatened breach of the above noncompetition and/or confidentiality provisions would cause irreparable injury to the Company that could not be adequately compensated by money damages. The Company may obtain a restraining order and/or injunction prohibiting my breach or threatened breach of the noncompetition and/or nondisclosure provisions, in addition to any other legal or equitable remedies that may be available. Executive agrees that the above noncompetition provision, including its duration, scope and geographic extent, is fair and reasonably necessary to protect Internap's client relationships, goodwill, Confidential Information and other protectable interests.

 

15. No Restrictions. Executive represents to the Company that he has not executed or is not bound by any non-competition covenant or non-solicitation covenant or any other undertaking similar to either of the foregoing that would prevent him from performing the duties and responsibilities of the position set forth in Section 1 of this Agreement.

 

16. Legal Expenses. The Company shall reimburse Executive for reasonable attorneys’ fees and expenses incurred by Executive in the negotiation and preparation of this Agreement, such amount not to exceed $5,000.

 

17. Relocation. Executive shall have a budget of (i) up to $150,000, including the tax gross-up that will be required, to be used for his relocation for expenses under the Internap Domestic Relocation Program Benefits attached hereto as Exhibit A (the “Relocation Program”) other than for expenses set forth in Sections 3.8 and 3.8-1 of the Relocation Program and (ii) up to $75,000 to be used for expenses set forth in Sections 3.8 and 3.8-1 of the Relocation Program, all such expenses subject to the terms of the Relocation Program that sets forth the relocation terms and dollar limits applicable to Executive’s circumstances.  

 

18. Arbitration. Except as specifically provided in this Agreement, the parties agree that any dispute or controversy arising out of, relating to or in connection with the interpretation, validity, construction, performance, breach or termination of this Agreement, shall be resolved by submission to arbitration by the American Arbitration Association in accordance with its Commercial Arbitration Rules.  The parties shall share the costs of the arbitrator equally but shall each bear their own costs and legal fees associated with the arbitration. The location of any such arbitration shall be in Georgia, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. 

 

 

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19. General Provisions. This Agreement is intended to bind and inure to the benefit of and be enforceable by Executive, the Company and their respective successors, assigns, heirs, executors, administrators, except that Executive may not assign any of his duties hereunder and Executive may not assign any of his rights hereunder without the written consent of the Company, which shall not be withheld unreasonably.

 

This Agreement, together with the Appendix, constitutes the complete, final and exclusive embodiment of the entire agreement between the Parties with regard to the subject matter hereof. It is entered into without reliance on any promise or representation, written or oral, other than those expressly contained herein, and it supersedes any other such promises or representations.

 

This Agreement shall be governed by and construed in accordance with the laws of the State of Georgia, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified otherwise than by a written agreement executed by the Parties hereto or their respective successors and legal representatives. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. If any provision in this Agreement is determined to be invalid, illegal, or unenforceable in whole or in part, the remaining provisions and any partially enforceable provisions shall remain in full force and effect.

 

 

A failure of Executive or the Company to insist upon strict compliance with any provision of this Agreement or the failure to assert any right Executive or the Company may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

 

From and after the date hereof, this Agreement shall supersede any employment, severance, change of control or other agreement, whether oral or written, between the Parties with respect to the subject matter hereof (other than arrangements effected under compensation plans generally applicable to other senior executives of the Company).

 

This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

 

IN WITNESS WHEREOF, the Parties have executed this Agreement effective as of the day and year first above written.

 

INTERNAP NETWORK SERVICES CORPORATION

JAMES DEBLASIO

 

By: Eugene Eidenberg, Chairman

/s/ Eugene Eidenberg

7/6/07

 

By: Jim DeBlasio

/s/ Jim P. DeBlasio

7/10/07

 

 

 

 

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EX-99.1 2 ex99-1.htm EXHIBIT 99.1


Exhibit 99.1


FIRST AMENDMENT TO EMPLOYMENT AGREEMENT


THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (this “First Amendment”) dated as of November 14, 2007, by and between Internap Network Services Corporation, a Delaware corporation with its principal office in Atlanta, Georgia (the “Company”), and James DeBlasio (“Executive”) (collectively the “Parties”).


Background


The Parties previously entered into that certain Employment Agreement dated as of July 10, 2007 (the “Employment Agreement”).  The Parties now desire to make certain changes to the Employment Agreement as set forth herein.


Agreement


NOW, THEREFORE, in consideration of the mutual promises contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:


1.           Section 8 of the Employment Agreement shall be deleted in its entirety and replaced with the following:


8.      Severance Payment. If the Company terminates Executive’s employment without Cause (as defined below) or if Executive terminates his employment for Good Reason (as defined below), Executive shall receive a lump sum cash severance payment equal to one and one-half (1.5) times Executive’s then-current Base Salary (the “Severance Amount”) payable in twelve (12) equal installments over the twelve (12) months following such termination commencing on the first ordinary payroll payment date that follows the date that is sixty (60) days after the date of such termination, which first ordinary payroll payment date must be within ninety (90) days of the date of such termination  (subject to the paragraph below). Executive does not have any right to designate the taxable year of the payment. Payment of the Severance Amount shall be subject to standard payroll tax withholdings and deductions. In addition, if the Company terminates Executive’s employment without Cause or if Executive terminates his employment for Good Reason, all of Executive’s unvested Equity Compensation shall lapse and expire, and all of Executive’s vested Equity Compensation shall remain exercisable until the earlier of three months after the date of termination and the original expiration date thereof. Notwithstanding the immediately preceding sentence, Executive shall not be entitled to any benefits or rights under this Section 8 if Executive also is eligible for payments and/or benefits under Section 9 hereof.

 



 

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If the Severance Amount exceeds the sum of two times the then-current compensation limit of Section 401(a)(17) of the Internal Revenue Code of 1986, as amended (the “Code”) plus the then-current dollar amount set forth in Section 402(g)(1)(B) of the Code (collectively, the “Statutory Amount”), then the Company shall pay the Severance Amount as follows: (i) within thirty (30) days of the termination, the Company shall pay Executive an amount equal to the Statutory Amount; and (ii) six months after the termination, the Company shall pay Executive an amount equal to the Severance Amount minus the Statutory Amount.  For purposes of this Section 8 and also Section 9 below, the terms “terminates,” “terminated” and “termination” shall have the meaning ascribed to such term in Treasury Regulation §1.409A-1(h)(1)(ii). It is intended that to the extent the Severance Amount does not provide for a deferral of compensation pursuant to the exceptions under Treas. Reg. §1.409A-1(b)(9)(iii) and (v)(D), the Severance Amount shall be quickly paid, but to the extent that the Severance Amount does provide for a deferral of compensation and does not fit within the exceptions under such regulations, the Severance Amount shall be delayed for a six (6) month period as required by Code §409A(a)(2)(B).


If Executive dies while employed pursuant to this Agreement, all of Executive’s unvested Equity Compensation that would, had he not have died, have become vested within twelve months after the date of his death (assuming fulfillment of any performance criteria and his continued employment by the Company) shall become vested, free of restrictions (other than those imposed by law) and immediately exercisable for a period ending on the earlier of twelve months after the date of death and the original expiration date thereof.


2.           The first two (2) paragraphs of Section 9 of the Employment Agreement shall be deleted in their entirety and replaced with the following the paragraphs:


9.      Change in Control Payments and Acceleration. Upon a Change in Control, all of Executive’s unvested Equity Compensation shall become immediately vested, free of restrictions (other than those imposed by law) and immediately exercisable for the remaining term of the relevant grant or award.


If the Company terminates Executive’s employment without Cause or Executive terminates his employment for Good Reason, in either case within 24 months after a Change in Control, then (i) the Company shall pay Executive a lump sum cash severance payment equal to two (2) times the sum of Executive’s then-current Base Salary plus the greater of (A) Executive’s maximum Bonus for the year in which the termination occurs and (B) Executive’s average Bonus during the prior two completed years (as a percentage of Executive’s Base Salary upon which his Bonus awards were calculated) multiplied by Executive’s then-current Base Salary (the “Change in Control Payment Amount”) payable in a single lump-sum on the first ordinary payroll payment date that follows the date that is sixty (60) days after the date of such termination  and such ordinary payroll payment date must be within ninety (90) days of the date of such termination (subject to the paragraph below), and (ii) all of Executive’s unvested Equity Compensation shall become immediately vested, free of restrictions (other than those imposed by law) and immediately exercisable for the remaining term of the relevant grant or award. Executive does not have any right to designate the taxable year of the payment.

 



 

2



 


 

If the Change in Control Payment Amount exceeds the Statutory Amount, then the Company shall pay the Change in Control Payment Amount as follows: (i) within thirty (30) days of the termination, the Company shall pay Executive an amount equal to the Statutory Amount; and (ii) six months after the termination, the Company shall pay Executive an amount equal to the Change in Control Payment Amount minus the Statutory Amount.  It is intended that to the extent the Change in Control Payment Amount does not provide for a deferral of compensation pursuant to the exceptions under Treas. Reg. §1.409A-1(b)(9)(iii) and (v)(D), the Change in Control Payment Amount shall be quickly paid, but to the extent that the Change in Control Payment Amount does provide for a deferral of compensation and does not fit within the exceptions under such regulations, the Change in Control Payment Amount shall be delayed for a six (6) month period as required by Code §409A(a)(2)(B).


3.           The following sentence shall be added to the end of the last paragraph of Section 9:


Executive shall be deemed to have terminated this Agreement for “Good Reason” if he delivers to the Company written notice within ninety (90) days of the existence of a condition the Executive believes constitutes Good Reason, specifying the basis for such termination, and the Company shall not have cured such condition in the thirty (30) days following receipt of Executive’s notice.


4.           A new Section 9(A) shall be inserted as follows:


9A.           Health Insurance. If Executive’s employment is terminated pursuant to Section 8 or Section 9, the Company shall reimburse (or directly pay) the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) continuation coverage premiums of Executive and the Executive’s eligible dependents under the Company’s major medical group health plan, dental plan and vision plan on a monthly basis for a period of 18 months or a lesser period if COBRA continuation coverage ends sooner.


5.           The second paragraph of Section 10 of the Employment Agreement shall be deleted in its entirety.


6.           Section 11 of the Employment Agreement shall be deleted in its entirety and replaced with the following:


11.  Release. Notwithstanding anything to the contrary contained in this Agreement, upon termination of Executive’s employment, unless Executive shall have executed and provided the Company with an effective release in the form attached as Appendix A by which Executive releases the Company and related persons from any and all claims of any kind, Executive shall not receive any severance payments or benefits provided under this Agreement.

 



 

3



 


 

7.           Except as specifically set forth herein, the terms and provisions of the Employment Agreement shall remain in full force and effect.  Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Employment Agreement.


(Signatures on the Following Page)

 



 

4



 

 

IN WITNESS WHEREOF, the Parties have executed this First Amendment as of the day and year first above written.



                                    INTERNAP NETWORK SERVICES CORPORATION


                                    By: /s/ Eugene Eidenberg

                                    Name: Eugene Eidenberg

                                    Its: Chairman of the Board of Directors


                                    EXECUTIVE


                                    /s/ James DeBlasio

                                    James DeBlasio

 

 

5



EX-10.3 4 ex10-3.htm EXHIBIT 10.3


Exhibit 10.3

 



AGREEMENT

 

THIS AGREEMENT (“Agreement”) is made this 29th day of January, 2009 (the “Effective Date”) by and between James P. DeBlasio (“Employee”) and Internap Network Services Corporation (“INTERNAP”), and arises out of the termination of Employee’s employment.

 

WHEREAS, Employee is leaving his position as president and chief executive officer of INTERNAP; and

 

WHEREAS, INTERNAP and Employee agreed to continue Employee’s employment with INTERNAP in order to allow for certain transition services; and

 

WHEREAS, Employee has completed the transition services; and

 

WHEREAS, Employee and INTERNAP agree that Employee’s employment with INTERNAP is ending effective March 15, 2009 (“Separation Date”);

 

NOW, THEREFORE, for and in consideration of the foregoing, the mutual promises and covenants set forth herein, and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, Employee and INTERNAP, intending to be legally bound, agree as follows:

 

1.           The foregoing recitals are hereby made a part of this Agreement and are incorporated herein by reference.

 

2.           Employee’s employment with INTERNAP is terminated effective on the Separation Date.

 

3.           (a)           Employee acknowledges and agrees that with payment of normal payroll through the Separation Date, he will have received all compensation (whether as deferred compensation, bonuses, or otherwise), employment benefits (including, but not limited to, health insurance, dental insurance, life insurance, disability insurance, 403(b) contributions, and profit-sharing payments), vacation pay, sick pay, other paid leave, and any other alleged obligations relating to Employee’s employment with INTERNAP through the Separation Date.

 

(b)           As consideration for Employee’s service to INTERNAP and for the promises made by Employee in this Agreement, INTERNAP agrees to pay to Employee the sum of Nine Hundred Twenty Seven Thousand Two Hundred and no/100 Dollars ($927,200.00).

 

The parties agree that this payment will be made to Employee as follows:

 

 

·

$475,500.00 within thirty days of the expiration of the seven (7) day revocation period set forth in Paragraph 9(b) of this Agreement, provided that Employee does not revoke nor breach this Agreement within that time period.

 









Page 1






 



 

·

$451,700.00 six (6) months plus one (1) day following final execution of this Agreement, provided that Employee has not revoked nor materially breached this Agreement within that time period.

 

(c)           All equity awards previously granted to Employee by INTERNAP shall be deemed to vest as of the Separation Date, provided that Employee does not revoke nor breach this Agreement within that time period.

 

4.           Employee and INTERNAP agree that Employee shall have twelve (12) months following the Separation Date in which to exercise the INTERNAP stock options held by him and that were vested as of the Separation Date, after which such options shall expire.  All unvested INTERNAP stock options shall expire on the Separation Date.

 

5.           Employee agrees that that the payment and covenants by INTERNAP referenced in Paragraph 3 shall fully and completely extinguish all obligations of INTERNAP to Employee, including, but not limited to, severance pay, compensation (whether as deferred compensation, bonuses, or otherwise), the provision of any employment benefits (including, but not limited to, health insurance, dental insurance, life insurance, disability insurance, 403(b) contributions, and profit-sharing payments), vacation pay, sick pay, or any other alleged obligations relating to Employee’s employment with INTERNAP, other than those specifically set forth in Paragraph 3.

 

 

6.           Employee may elect to continue, at the Company’s cost, health, dental and vision insurance coverage for Employee and Employee’s eligible dependents under INTERNAP’s healthcare, dental and vision coverage plan commencing on the Separation Date and continuing thereafter for a period of eighteen (18) months, pursuant to Title X of the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA).  In the event Employee elects to continue such health insurance coverage, Employee shall so advise INTERNAP in writing.   Employee agrees to notify INTERNAP if Employee secures alternate coverage during the eighteen (18) month period.  Employee will be eligible to convert any life insurance coverage to an individual plan.

 

7.           Employee acknowledges INTERNAP is relying on Employee’s compliance with the terms of the Covenants Agreement attached hereto as Schedule A.

 

8.           At INTERNAP’s request, Employee agrees to (a) provide reasonable consulting services to INTERNAP following the Separation Date to assist in transition matters, and (b) fully cooperate with reasonable requests by INTERNAP regarding any investigations, claims or litigation involving INTERNAP about which the Employee has knowledge or the ability to assist INTERNAP in its defense.  Employee will be compensated at the rate of $250 per hour for his time associated with his participation in the above matters.  INTERNAP will reimburse Employee for all reasonable out of pocket expenses incurred in providing such cooperation.

 









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9.           (a)           In consideration of the foregoing payments and covenants, Employee, for himself and for his heirs, legal representatives, and assigns, hereby unconditionally and absolutely releases, remises, acquits and forever discharges INTERNAP and its heirs, executors, administrators, legal and personal representatives; former and/or current owners, partners, officers, directors, employees, residents, shareholders, managers, agents, attorneys, predecessors, successors, assigns, trustees, purchasers, principals, and privies; past, present, and future parent, subsidiary, and affiliated companies (both direct and indirect), divisions, related trade names, and affiliated entities of any kind; insurers; and any person or entity who may be jointly liable with INTERNAP or any of the aforesaid persons or entities (hereinafter referred to as the “INTERNAP Releasees”) from any and all claims, charges, suits, personal remedies, debts, dues, demands, grievances, sums of money, rights, damages, liabilities, proceedings, actions, and causes of action of any kind, nature, or character (whether known or unknown, whether suspected or unsuspected, and whether at law, in equity, or otherwise), which relate to and/or arise out of any fact or event whatsoever from the beginning of time to and including the Effective Date of this Agreement.  The foregoing release includes, but is not limited to, those rights and personal remedies arising under:  (a) Title VII of the Civil Rights Act of 1964, as amended; (b) the Civil Rights Act of 1991; (c) 42 U.S.C. § 1981; (d) the Age Discrimination in Employment Act; (e) the Fair Labor Standards Act; (f) the Americans with Disabilities Act of 1990, as amended; (g) the Rehabilitation Act of 1973, as amended; (h) any federal, state, or local handicap, disability, or discrimination related act, regulation, ordinance, statute, or executive order; and (i) any ordinance or statute promulgated by any city, county, municipality, or other state subdivision.  Furthermore, this release also includes, but is not limited to, the following:  (1) claims for retaliatory or wrongful discharge of any kind; (2) claims for unpaid or withheld wages, severance pay, benefits, bonuses, and/or other compensation or benefits of any kind; (3) claims for intentional or negligent infliction of emotional or mental distress or for outrageous conduct; (4) claims for breach of duty, libel, slander, or tortious conduct of any kind; (5) claims for interference with business relationships, contractual relationships, or employment relationships of any kind; (6) claims for breach of an implied covenant of good faith and fair dealing; (7) claims for interference with and/or breach of contract (whether express or implied, in fact or in law, oral or written); (8) claims for attorneys’ fees, costs, or expenses; (9) claims for personal remedies from alleged discrimination of any kind; (10) claims based upon the creation, maintenance, or subjection to a hostile or offensive work environment; (11) claims for constructive discharge; (12) claims for personal remedies from claims of retaliation; and/or (13) any and all claims which Employee ever had or has arising as a result of or connected in any way with his employment with and/or his subsequent separation from employment with INTERNAP.  Employee agrees never to file a lawsuit to seek damages or other personal relief from INTERNAP based upon the claims being released under this Agreement.

 









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(b)           Employee agrees never to file a lawsuit, claim, or cause of action seeking damages, reinstatement, attorney fees or other personal relief against INTERNAP and/or the INTERNAP Releasees based on the claims being released by his in this Agreement.  Notwithstanding this waiver of remedies, above, nothing in this Agreement shall be construed to prohibit Employee from (1) filing a charge with the Equal Employment Opportunity Commission or (2) participating in any investigation or proceeding conducted by the Equal Employment Opportunity Commission, or (3) filing any charge or claim – including Worker’s Compensation claims – not waiveable by law.

 

10.           Employee knowingly relinquishes, waives and forever releases any and all claims or personal remedies arising under the Age Discrimination in Employment Act, 29 U.S.C.§ 621, et seq., related in any manner to his employment with INTERNAP or his separation from such employment.  In making this release:

 

(a)           Employee acknowledges that he has twenty-one (21) days to review this Agreement prior to signing it.  To the extent that Employee has decided to execute this Agreement prior to the expiration of the twenty-one (21) day period, he acknowledges that he has voluntarily executed the Election attached to this Agreement as Exhibit 1.

 

(b)           Employee understands that he has a period of seven (7) days after signing this Agreement to revoke it and not receive the monetary payments or other consideration provided to him under the terms of this Agreement.

 

(c)           Employee further understands that this Paragraph 9, pertaining specifically to claims or rights arising under the Age Discrimination in Employment Act, does not cover any rights, claims, or remedies, if any, that may arise after the date on which this Agreement is executed, and does not affect his right to challenge the validity of this release under the law.

 

(d)           Employee acknowledges and agrees that the payments and other consideration made by INTERNAP under Paragraph 3 of this Agreement are in addition to anything of value to which Employee is already entitled.

 

11.           Employee agrees to fully cooperate with reasonable requests by INTERNAP regarding any and all matters associated with any investigations, claims or litigation involving INTERNAP about which the Employee has knowledge or the ability to assist INTERNAP in its defense for three (3) years following the date of this Agreement.  Employee’s cooperation in such matters will include answering questions by INTERNAP regarding the subject of any such investigations, claims, or litigation, voluntarily participating in depositions, providing affidavits and testimony if necessary, and assisting INTERNAP in responding to data or discovery requests.  INTERNAP agrees to use every effort to ensure the time periods in which Employee’s assistance is sought do not conflict with Employee’s work or other business-related obligations.  Employee agrees that any participation in the above-referenced matters will be truthful and factual.  INTERNAP will reimburse Employee for all reasonable out of pocket expenses incurred in providing such cooperation.

 

12.           This Agreement shall not in any way be construed as an acknowledgement or admission by INTERNAP that it has acted wrongfully with respect to Employee or to any other person or that Employee has any rights whatsoever against INTERNAP.  INTERNAP specifically disclaims any liability to or wrongful acts against Employee or any other person.

 









Page 4






 



13.           From and after the Effective Date of this Agreement, Employee will not provide any disparaging information about INTERNAP or any of its current or former parties, officers, directors, agents, employees, or representatives to any person or entity who is not a party to this Agreement nor will he request or direct other persons to do so, except to the extent required by:  (a) a court order; (b) a lawfully issued subpoena, provided that Employee, to the extent possible, provides INTERNAP with written notice of the existence of such subpoena at least five (5) calendar days prior to such disclosure and agrees not to contest any motion for protective order or motion to quash filed by INTERNAP; or (c) otherwise by applicable law.

 

14.           Employee represents that on or before the Separation Date he will return to INTERNAP any property and/or business documents of INTERNAP.  Employee agrees that if subsequent to the Separation Date he discovers any property of INTERNAP, he will promptly return it to:  VP HR, Internap Network Services Corporation, 250 Williams Street, Suite E-100, Atlanta, GA 30303.

 

15.           Any other benefits not mentioned in this Agreement that Employee may be entitled to, including, but not limited to, his rights to health insurance continuation under Georgia law, shall be provided to Employee in accordance with the underlying plan or document governing such benefits and/or applicable law.

 

16.           Employee acknowledges and agrees that, before signing this Agreement, he was advised and is hereby advised in writing by INTERNAP to review it and consult with an attorney of his choosing and that, to the extent Employee desired, he has availed himself of these opportunities.

 

17.           Employee represents and agrees that he has carefully read and fully understands all of the provisions of this Agreement.  Employee understands the final and binding nature of the release and waiver of his rights specified herein, and he knowingly and voluntarily enters into this Agreement with the intent to be bound by it, and without any coercion or duress from any person or source whatsoever.

 

18.           This Agreement represents and contains the entire agreement and understanding between the parties with respect to the terms and conditions of this Agreement, and supersedes any and all prior and contemporaneous written and oral agreements, understandings, representations, inducements, promises, warranties, and conditions between the parties with respect to the terms and conditions of this Agreement, including without limitation any employment agreement between Employee and Internap.  Except for the Covenants Agreement, attached hereto as Schedule A, no other agreement, understanding, representation, inducement, promise, warranty, or condition of any kind with respect to the terms and conditions of this Agreement shall be relied upon by the parties unless expressly incorporated herein.

 

19.           This Agreement may not be amended or modified except by an agreement in writing signed by all of the parties hereto.

 









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20.           Any failure of any party on one or more occasions to enforce or require the strict keeping and performance of any of the terms and conditions of this Agreement shall not constitute a waiver of such terms and conditions of this Agreement, shall not constitute a waiver of such term or condition at any future time, and shall not prevent any party from insisting on the strict keeping and performance of such terms and conditions at a later time.

 

21.           The provisions of this Agreement shall be deemed severable, and any invalidity or unenforceability of any one or more of its provisions shall not affect the validity or enforceability of the other provisions hereof.

 

22.           Each party to this Agreement agrees and acknowledges that no presumption, inference, or conclusion of any kind shall be made or drawn against the drafter or draft(s) of this Agreement.  Each party to this Agreement also agrees and acknowledges that he/it has contributed to the final version of this Agreement through comments and negotiations.

 

23.           This Agreement shall be binding upon and shall inure to the benefit of the parties and each of their respective heirs, personal and legal representatives, purchasers, executors, administrators, successors and assigns.  Employee may not assign any rights or obligations hereunder without INTERNAP’s prior written consent.

 

24.           It is understood and agreed that the parties to this Agreement do hereby declare, represent, acknowledge and warrant that:

 

(a)           IN EXECUTING THIS AGREEMENT, THE PARTIES HERETO RELY UPON THEIR OWN JUDGMENT, BELIEF, AND KNOWLEDGE AS TO THE NATURE, EXTENT, AND EFFECT OF THE POTENTIAL LIABILITY OF THE PARTIES AND OF THE LIABILITIES, WHETHER POTENTIAL OR OTHERWISE, WHICH ARE BEING RELEASED BY THIS AGREEMENT AND THE PARTIES FURTHER ACKNOWLEDGE AND AGREE THAT THEY ARE ENTERING INTO THIS AGREEMENT AND SIGNING THE SAME VOLUNTARILY AND KNOWINGLY AND WITHOUT ANY DURESS, COERCION, INTIMIDATION, OR FORCE; and

 

(b)           The terms of this Agreement are contractual and not mere recitals; and

 

(c)           This Agreement is deemed to have been entered into in the State of Georgia and shall be construed and interpreted at all times and in all respects in accordance with the laws of the State of Georgia without regard to the principles of conflicts of laws, and jurisdiction and venue for any action relating in any manner to this Agreement shall be in a court of competent jurisdiction in the State of Georgia.

 

25.           This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which shall be deemed as being the same instrument.

 









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26.           The persons executing this Agreement do hereby declare, represent, acknowledge, warrant, and agree that such person is duly and fully authorized to execute this Agreement so as to legally bind Employee and INTERNAP.

 

27.           Employees understands that, if he signs this Agreement, he may change his mind and revoke his acceptance within seven days after signing it by giving notice in writing to INTERNAP at the following address:

 

Internap Network Services Corporation

 

Attention:              Director, Human Resources Department

250 Williams Street, Suite E-100

Atlanta, Georgia  30303


With copy to:       Chief Administrative Officer


28.           Employee understands that this Agreement will not be effective or enforceable until the seven-day revocation period has expired, but will become effective and enforceable as soon as the revocation period ends.


IN WITNESS WHEREOF, the parties have executed this General Release and Separation Agreement as of the date indicated below:

 

 

 

 

/s/ Christy Reese                                                                

WITNESS

 

 

 

/s/ James P. DeBlasio                                                             

 

 

 

Date:                      1/29/09                                                      

 

 

 

 

 

 

 

/s/ Christy Reese                                                                

WITNESS

 

INTERNAP NETWORK SERVICES

CORPORATION

 

/s/ Richard P. Dobb                                                                

By: Richard P. Dobb

Title: CAO

Date:                      1/29/09                                                      

 

 









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ELECTION TO EXECUTE PRIOR TO EXPIRATION OF

TWENTY-ONE DAY CONSIDERATION PERIOD

 

I, James P. DeBlasio, understand that I have at least twenty-one (21) days within which to consider and execute the attached General Release, Separation and Settlement Agreement.  However, after having been advised of my right to consult with an attorney and having exercised that right to the extent desired, I have freely and voluntarily elected to execute the General Release and Separation Agreement before the twenty-one (21) day period has expired.

 

 

  /s/ James P. DeBlasio

 

 

 

 

 

 

 

 

 

 

Date:

      1/29/09

 

 

 

 

EXHIBIT 1







 



COVENANTS AGREEMENT


This COVENANTS AGREEMENT (“Agreement”) is made this 29th day of January, 2009, (the “Effective Date”), between Internap Network Services Corporation (“Internap”) and James P. DeBlasio (“You” or “Your”) (collectively, the “Parties”).1


For and in consideration of ten dollars, and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, You agree to the following terms:

 

1.

Acknowledgments.  You acknowledge and agree that:

 

 

(a)

Your position as an employee with Internap was a position of trust and responsibility with access to Confidential Information, Trade Secrets, and information concerning Employees, Customers, and Prospective Customers of Internap;

 

 

(b)

the Trade Secrets and Confidential Information, and the relationship between Internap and its Employees, Customers, and Prospective Customers, are valuable assets of Internap which may not be used for any purpose other than Internap’s Business;

 

 

(c)

the names of Customers and Prospective Customers are considered Confidential Information of the Business which constitutes valuable, special, and unique property of Internap;

 

 

(d)

Customer and Prospective Customer lists, and Customer and Prospective Customer information, which have been compiled by Internap represents a material investment of Internap’s time and money;

 

 

(e)

Internap invested its time and money in the development of Your skills in the Business; and

 

 

(f)

the restrictions contained in this Agreement, including, but not limited to, the restrictive covenants set forth in Sections 2 – 6 below, are reasonable and necessary to protect the legitimate business interests of Internap, and they do not impair or infringe upon Your right to work or earn a living subsequent to Your employment with Internap.

 

2.

Trade Secrets and Confidential Information.

 

 

(a)

You represent and warrant that:

 

 

(i)

You are not subject to any legal or contractual duty or agreement that would prevent or prohibit You from performing Your duties for Internap or complying with this Agreement, and

 

 

(ii)

You are not in breach of any legal or contractual duty or agreement, including any agreement concerning trade secrets or confidential information, owned by any other person or entity.

 

 

(b)

You shall not:

 

__________________________________

1 Unless otherwise indicated, all capitalized terms used in this Agreement are defined in the “Definitions” set forth in Exhibit A.  Exhibit A is incorporated by reference and is included in the definition of “Agreement.”

 









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(i)

use, disclose, or reverse engineer the Trade Secrets or the Confidential Information for any purpose except as authorized in writing by Internap;

 

 

(ii)

use, disclose, or reverse engineer (a) any confidential information or trade secrets of any former employer or third party, or (b) any works of authorship developed in whole or in part by You during any former employment or for any other party, unless authorized in writing by the former employer or third party; or

 

 

(iii)

(a) retain Trade Secrets or Confidential Information, including any copies existing in any form (including electronic form), or (b) destroy, delete, or alter the Trade Secrets or Confidential Information without Internap’s prior written consent.

 

 

(c)

The obligations under this Agreement shall:

 

 

(i)

with regard to the Trade Secrets, remain in effect as long as the information constitutes a trade secret under applicable law; and

 

 

(ii)

with regard to the Confidential Information, remain in effect during the Restricted Period.

 

 

(d)

The confidentiality, property, and proprietary rights protections available in this Agreement are in addition to, and not exclusive of, any and all other rights to which Internap is entitled under federal and state law, including, but not limited to, rights provided under copyright laws, trade secret and confidential information laws, and laws concerning fiduciary duties.

 

3.   Non-Disclosure of Customer or Prospective Customer Information.  During the Restricted Period, You shall not, except as authorized by Internap, divulge or make accessible to any person or entity (i) the names of Customers or Prospective Customers, or (ii) any information contained in Customers’ or Prospective Customers’ accounts.

 

4.   Non-Solicitation of Customers.  During the Restricted Period, You shall not, directly or indirectly, solicit any Customer of Internap for the purpose of selling or providing any products or services competitive with the Business.  The restrictions set forth in this Section apply only to Customers with whom You had Contact during the term of Your employment.  Nothing in this Section shall be construed to prohibit You from soliciting any Customer of Internap for the purpose of selling or providing any products or services competitive with the Business: (i) which You never sold or provided while employed by Internap; (ii) to a Customer that explicitly severed its business relationship with Internap unless You, directly or indirectly, caused or encouraged the Customer to sever the relationship; or (iii) which products or services Internap no longer offers.

 

5.   Non-Solicitation of Prospective Customers.  During the Restricted Period, You shall not, directly or indirectly, solicit any Prospective Customer of Internap for the purpose of selling or providing any products or services competitive with the Business.  The restrictions set forth in this Section apply only to Prospective Customers with whom You had Contact during the last year of Your employment with Internap (or during Your employment if employed less than a year).  Nothing in this Section shall be construed to prohibit You from soliciting any Prospective Customer of Internap for the purpose of selling or providing any products or services competitive with the Business which Internap no longer offers.

 









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6.   Non-Recruitment of Employees.  During the Restricted Period, You shall not, directly or indirectly, solicit, recruit, or induce any Employee to (i) terminate his employment relationship with Internap, or (ii) work for any other person or entity engaged in the Business.  The restrictions set forth in this Section shall apply only to Employees (a) with whom You had Material Interaction, or (b) You, directly or indirectly, supervised.

 

7.   Post-Employment Disclosure. During the Restricted Period, You shall provide a copy of this Agreement to persons and/or entities who at any time are likely to be competitive with Internap’s Business for which You work or consult as an owner, partner, joint venturer, employee or independent contractor.  If, during the Restricted Period, You work or consult for another person or entity who at any time is, or is likely to be, competitive with Internap’s Business as an owner, partner, joint venturer, employee or independent contractor, You shall provide Internap with such person or entity’s name, the nature of such person or entity’s business, Your job title, and a general description of the services You will provide.

 

8.   Injunctive Relief. If You breach any portion of this Agreement, You agree that:

 

 

(a)

Internap would suffer irreparable harm;

 

 

(b)

it would be difficult to determine damages, and money damages alone would be an inadequate remedy for the injuries suffered by Internap;  and

 

 

(c)

if Internap seeks injunctive relief to enforce this Agreement, You shall waive and shall not (i) assert any defense that Internap has an adequate remedy at law with respect to the breach, (ii) require that Internap submit proof of the economic value of any Trade Secret or Confidential Information, or (iii) require Internap to post a bond or any other security.

 

Nothing in this Agreement shall limit Internap’s right to any other remedies at law or in equity.

 

9.   Independent Enforcement.  Each of the covenants set forth in Sections 2 – 6 of this Agreement shall be construed as an agreement independent of (i) each of the other covenants set forth in Sections 2 – 6, (ii) any other agreements, or (iii) any other provision in this Agreement, and the existence of any claim or cause of action by You against Internap, whether predicated on this Agreement or otherwise, regardless of who was at fault and regardless of any claims that either You or Internap may have against the other, shall not constitute a defense to the enforcement by Internap of any of the covenants set forth in Sections 2 – 6 of this Agreement.  Internap shall not be barred from enforcing any of the covenants set forth in Sections 2 – 6 of this Agreement by reason of any breach of (i) any other covenant set forth in Sections 2 – 6 of this Agreement, (ii) any other part of this Agreement, or (iii) any other agreement with You.

 

10. Attorneys’ Fees.  In the event of litigation relating to this Agreement, Internap shall, if it is the prevailing party, be entitled to recover attorneys’ fees and costs of litigation in addition to all other remedies available at law or in equity.

 

11. Waiver.  Internap’s failure to enforce any provision of this Agreement shall not act as a waiver of that or any other provision.  Internap’s waiver of any breach of this Agreement shall not act as a waiver of any other breach.

 

12. Severability.  The provisions of this Agreement are severable. If any provision is determined to be invalid, illegal, or unenforceable, in whole or in part, the remaining provisions and any partially enforceable provisions shall remain in full force and effect.

 









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13. Governing Law.  The laws of the State of Georgia shall govern this Agreement.  If Georgia’s conflict of law rules would apply another state’s laws, the Parties agree that Georgia law shall still govern.

 

14. No Strict Construction.  If there is a dispute about the language of this Agreement, the fact that one Party drafted the Agreement shall not be used in its interpretation.

 

15. Entire Agreement.  This Agreement supersedes any prior communications, agreements or understandings, whether oral or written, between the Parties relating to the subject matter of this Agreement.

 

16. Successors and Assigns.  This Agreement shall be assignable to, and shall inure to the benefit of, Internap’s successors and assigns, including, without limitation, successors through merger, name change, consolidation, or sale of a majority of Internap’s stock or assets, and shall be binding upon You.  You shall not have the right to assign Your rights or obligations under this Agreement. The covenants contained in this Agreement shall survive cessation of Your employment with Internap, regardless of who causes the cessation or the reason for the cessation.

 

17. Consent to Jurisdiction and Venue.  You agree that any and all claims arising out of or relating to this Agreement shall be brought in a state or federal court of competent jurisdiction in Georgia. You consent to the personal jurisdiction of the state and/or federal courts located in Georgia. You waive (a) any objection to jurisdiction or venue, or (b) any defense claiming lack of jurisdiction or improper venue, in any action brought in such courts.

 

18. Execution.  This Agreement may be executed in one or more counterparts, including, but not limited to, facsimiles. Each counterpart shall for all purposes be deemed to be an original, and each counterpart shall constitute this Agreement.

 

19. Affirmation.  You acknowledge that You have carefully read this Agreement, You know and understand its terms and conditions, and You have had the opportunity to ask Internap any questions You may have had prior to signing this Agreement.


IN WITNESS WHEREOF, the Parties have signed this Agreement as of the Effective Date.

 

 

Internap Network Services Corporation

 

 

/s/ James P. DeBlasio

 

 

 

 

Employee Signature

 

 

 

 

 

 

By:              /s/ Richard P. Dobb

 

 

 

 

Name:         Richard P. Dobb

 

 

 

 

Title:           CAO

 

 

 

 

Address: Internap Network Services Corporation  

 

 

Employee’s Address:

 

250 Williams Street, Suite E-100

 

 

 

 

Atlanta, Georgia 30303

 

 

 

 










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EXHIBIT A

DEFINITIONS

 

 

A.

Business” shall mean the business of Internap Network Services Corporation, consisting of content delivery network services, IP services, colocation services and advertising services.

 

 

 

B.

Confidential Information” means (a) information of Internap, to the extent not considered a Trade Secret under applicable law, that (i) relates to the business of Internap, (ii) possesses an element of value to Internap, (iii) is not generally known to Internap’s competitors, and (iv) would damage Internap if disclosed, and (b) information of any third party provided to Internap which Internap is obligated to treat as confidential, including, but not limited to, information provided to Internap by its licensors, suppliers, or customers.  Confidential Information includes, but is not limited to, (i) future business plans, (ii) the composition, description, schematic or design of products, future products or equipment of Internap or any third party, (iii) communication systems, audio systems, system designs and related documentation, (iv) advertising or marketing plans, (v) information regarding independent contractors, employees, clients, licensors, suppliers, customers, or any third party, including, but not limited to, customer lists compiled by Internap, and customer information compiled by Internap, and (vi) information concerning Internap’s or a third party’s financial structure and methods and procedures of operation.  Confidential Information shall not include any information that (i) is or becomes generally available to the public other than as a result of an unauthorized disclosure, (ii) has been independently developed and disclosed by others without violating this Agreement or the legal rights of any party, or (iii) otherwise enters the public domain through lawful means.

 

 

C.

Contact” means any interaction with a Customer or Prospective Customer, which takes place in an effort to establish, maintain, and/or further a business relationship on behalf of Internap.

 

 

D.

Customer” means any person or entity to which Internap has sold its products or services.

 

 

E.

Employee” means any person who (i) is employed by Internap at the time Your employment with Internap ends, or (ii) was employed by Internap during the last year of Your employment with Internap.

 

 

F.

Licensed Materials” means any materials that You utilize for the benefit of Internap, or deliver to Internap or Internap’s customers, who (i) do not constitute Work Product, (ii) are created by You or of which You are otherwise in lawful possession, and (iii) You may lawfully utilize for the benefit of, or distribute to, Internap or Internap’s customers.

 

 

G.

"Material Interaction" means any interaction with an Employee, which relates or related, directly or indirectly, to the performance of Your duties or the Employee's duties for Internap.

 

 

H.

Prospective Customer” means any person or entity to which Internap has solicited to sell its products or services.

 

 

I.

Restricted Period” means the one-year period following the termination of Your employment with Internap.

 









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J.

Trade Secrets” means information of Internap, and its licensors, suppliers, clients, and customers, without regard to form, including, but not limited to, technical or nontechnical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, a list of actual customers, clients, licensors, or suppliers, or a list of potential customers, clients, licensors, or suppliers which is not commonly known by or available to the public and which information (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

 

 

 

 



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