Exhibit 10.16
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into as of August
1, 2002 by and between IFX CORPORATION, a Delaware corporation ("IFX" and,
collectively with its subsidiaries, "Employer"), and HOWARD F. ZUCKERMAN, a
Maryland resident ("Employee").
W I T N E S S E T H:
WHEREAS, Employer is in the business of developing and maintaining a
facilities-based Internet access network and related services in Latin America
and other non-U.S. jurisdictions (the "Business");
WHEREAS, Employer desires to employ Employee as Chief Financial Officer of
Employer, and Employee desires to accept such employment, on the terms and
subject to the conditions set forth herein;
WHEREAS, Employer believes it would be in the best interest of Employer to
have Employee's terms of employment set forth in a written agreement; and
WHEREAS, Employee has had an opportunity to review the terms and conditions
of this Agreement, to negotiate the terms hereof and to engage legal counsel on
his behalf if he so desires.
NOW, THEREFORE, in consideration of Employer's continued employment of
Employee, the terms, conditions and covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Employee and Employer, intending to be legally bound, hereby agree
as follows:
ARTICLE I
DEFINITIONS
1.1 Terms Defined Herein. Except as otherwise herein expressly provided,
the following terms and phrases shall have the meanings set forth below:
"Affiliate" means (a) in the case of an entity, any Person who or which,
directly or indirectly, through one or more intermediaries, controls or is
controlled by, or is under common control with, any specified Person or (b) in
the case of an individual, such individual's spouse, children, grandchildren or
parents or a trust primarily for the benefit of any of the foregoing; provided,
however, in respect of the Employer, "Affiliate" shall exclude UBS AG and its
affiliates (including, without limitation, UBS Capital Americas III, L.P. and
UBS Capital LLC) ("UBS") other than IFX and its subsidiaries.
"Cause" means (a) the willful and continued failure by Employee to
substantially perform his duties under this Agreement (other than any failure
resulting from Employee's death or incapacity due to physical or mental illness)
for five (5) days after written demand for substantial
performance is delivered by Employer to Employee which specifically identifies
the manner in which Employer believes Employee has not substantially performed
his duties and which demand is specifically identified as being issued pursuant
to this paragraph (a), (b) the commission by Employee of theft, embezzlement,
fraud or misappropriation of funds or the willful engaging by Employee in other
misconduct which is materially injurious to Employer, (c) the willful violation
by Employee of Section 3.1, 3.2, 3.3 or 3.4 of this Agreement, (d) the
conviction of Employee of a felony involving fraud, dishonesty or moral
turpitude; in each case, from and after the date of this Agreement or (e) the
engaging by Employee in gross negligence or recklessness in connection with the
performance of his duties. None of the following conduct, acts or omissions of
Employee or events shall, standing alone, be treated as "cause."
(i) bad judgment,
(ii) negligence,
(iii) any act or omission that Employee reasonably believed in good faith
to have been in or not opposed to the interests of the Employer,
(iv) any act or omission for which Employee received authorization and/or
direction from the board of directors of IFX (the "Board") or the Audit
Committee thereof, as evidenced by a writing from the Chairman of the Board or
Chairman of the Audit Committee, as the case may be, describing such
authorization and/or direction, or by the minutes of the relevant meeting of the
Board or the Audit Committee, and
(vi) any act or omission of which any member of the Board who is not a
party to such act or omission has had actual knowledge for at least 12 months.
"Change in Control" means the occurrence of any one of the following
events:
(i) any consolidation, merger or other similar transaction involving
IFX, if IFX is not the continuing or surviving corporation (unless the
transferee corporation owns no substantial assets after the transaction
other than those owned by IFX immediately before such transaction or unless
the stockholders of IFX immediately prior to such transaction continue to
own a majority of the voting stock of the continuing or surviving
corporation immediately after such transaction), or which contemplates that
all or substantially all of the business and/or assets of IFX will be
controlled by another corporation (unless the transferee corporation owns
no substantial assets after the transaction other than those owned by IFX
immediately before such transaction or unless the stockholders of IFX
immediately prior to such transaction continue to own a majority of the
voting stock of the continuing or surviving corporation immediately after
such transaction);
(ii) any sale, lease, exchange or transfer (in one transaction or
series of related transactions) of all or substantially all of the assets
of the Employer;
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(iii) approval by the shareholders of IFX of any plan or proposal for
the liquidation or dissolution of IFX, unless such plan or proposal is
abandoned within 60 days following such approval;
(iv) the acquisition by any "person" (as such term is used in
Sections 13(d) and 14(d)(2) of the Exchange Act), or two or
more persons acting in concert, directly or indirectly, of
beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 50% or more of the
outstanding shares of voting stock of IFX; provided, however,
that for purposes of the foregoing, "person" excludes Lee S.
Casty, International Technology Investments, LC, UBS, or any of
their respective Affiliates;
or
(v) if, those individuals (the "Continuing Directors") who either
(A) were directors of IFX on the date hereof or (B) subsequently became
directors of IFX and whose actual election or initial nomination for
election subsequent to that date was approved by a majority of the
Continuing Directors then on the Board , cease to constitute a majority of
the Board ; provided, however, that for purposes of the foregoing,
replacement UBS directors appointed in substitution of one or more current
UBS-appointed directors shall be considered Continuing Directors.
"Common Stock" means shares of common stock, par value $.02 per share, of
IFX.
"Disability" means disability as defined in Employer's disability insurance
plan then in effect, or permanent disability as defined in Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended.
"Involuntary Termination" means if Employer terminates Employee for any
reason other than Cause or if Employee terminates his employment with Employer
(a) within 30 days after Employer materially reduces Employee's duties and
responsibilities or changes Employee's permanent work location hereunder; (b)
within five (5) days after Employer's receipt of written notice from Employee
that Employer is in material breach of its obligations under this Agreement,
which material breach has not been cured during such five-day period (provided,
however, that in the event such breach is curable but Employer is unable to cure
such breach within such five-day period, then any such breach shall not be
deemed to justify Employee's "Involuntary Termination" hereunder so long as
Employer is diligently and in good faith pursuing a cure and such breach is
cured no later than 30 days following receipt of the foregoing written notice
from Employee), (c) because he is assigned duties materially inconsistent with
his position and duties described in this Agreement without his consent; (d)
because he no longer reports to the Chief Executive Officer of IFX, or (e)
because of the failure of IFX to assign this Agreement to a successor to IFX or
the failure of a successor to IFX to explicitly assume and agree to be bound by
this Agreement.
"Option" means non-qualified options to acquire shares of Common Stock
granted in accordance with the Plan.
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"Person" means any individual, partnership, corporation, limited liability
company, joint venture, trust, firm, association, unincorporated organization or
other entity.
"Plan" means the IFX Corporation Stock Option and Incentive Plan, as
amended, in the form of Exhibit B attached hereto and made a part hereof, as
same may be modified from time to time.
ARTICLE II
TERMS OF EMPLOYMENT
2.1 Employment; Scope of Duties.
(a) Employer agrees to employ Employee as Chief Financial Officer, and
Employee hereby accepts such employment with Employer. Employee will be based at
Employer's corporate headquarters in Florida. Employee shall report to the Chief
Executive Officer and shall also be subject to the supervision of the Audit
Committee of the Board, the Board, and any other person or entity designated by
the Board.
(b) Employee shall devote his best efforts and full business time and
attention to the performance of services for Employer in accordance with the
terms hereof. During the Term (as defined in Section 2.4), Employee shall not
engage in any other business or professional activities, either on a full-time
or part-time basis, as an employee, consultant or in any other capacity, whether
or not he receives any compensation therefor, without the prior written consent
of Employer's Board; provided, however, that nothing herein shall prevent
Employee from (i) making and managing personal investments consistent with
Section 3.3 of this Agreement, (ii) acting in a fiduciary capacity as trustee,
executor or administrator of a trust or estate, or (iii) engaging in community
and/or charitable activities or serving in professional organizations, so long
as such activities, either singly or in the aggregate, do not interfere with the
proper performance of Employee's responsibilities to Employer.
2.2 Compensation.
(a) As compensation for Employee's services hereunder during the Term,
Employer shall pay to Employee an annual base salary of $220,000 (the "Salary"),
less applicable income tax withholdings, which Salary shall be reviewed for an
increase, if any, on an annual basis by the Compensation Committee of the Board
in its discretion. The Salary shall be payable in equal semi-monthly
installments in accordance with Employer's customary compensation policies. If,
during the term of this Agreement, the Employee should be prevented from
performing his duties by reason of Disability, amounts payable by Employer
hereunder shall be reduced by the gross amounts actually paid to Employee under
the Employer's disability insurance policy. Employee shall be eligible to
receive a bonus of up to 35 % of the Salary, with the actual amount, if any, of
any such bonus to be determined at the sole discretion of the Compensation
Committee of the Board and/or the Board.
(b) In addition to the Salary, during the first year of the term of this
Agreement, Employee shall be eligible to receive reimbursements for actual,
out-of-pocket travel expenses between Germantown, Maryland and Miami Lakes,
Florida and out-of-pocket lodging expenses
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in Florida in the aggregate amount of up to $35,000, payable in arrears.
Employee shall use his reasonable efforts to minimize the cost of such
transportation and lodging expenses and shall utilize Employer's travel agent
(as may be requested by Employer), and adhere to Employer travel policies.
Employee shall submit written documentation of all expenses in a timely manner,
and Employer shall process such expenses in a timely manner. If, after such
first year of the term, Employee shall not have incurred $35,000 in reimbursable
expenses under this Section 2.2(b), then the difference between $35,000 and the
aggregate amount reimbursed to Employee under this Section 2.2(b) shall remain
with Employer.
(c) In addition to the Salary, Employee shall be granted Options as shown
on Exhibit A attached hereto and made a part hereof. The Options shall be
evidenced by an option agreement between Employer and Employee in the form of
Exhibit C attached hereto and made a part hereof (the "Option Agreement"). The
parties acknowledge and agree that the Options represent one percent (1%) of the
outstanding shares of common stock of IFX on a fully diluted basis, as set forth
on Exhibit D attached hereto and made a part hereof.
2.3 Employee Benefits.
(a) Employee shall be entitled to such paid holidays and vacation time as
is consistent with Employer's standard holiday and vacation policy for executive
employees of Employer.
(b) Subject to Employer's rules, policies and regulations as in effect from
time to time (and subject to applicable eligibility requirements, including a
minimum employment period), Employee shall be entitled to (i) group life
insurance, disability or accident, death or dismemberment insurance, (ii)
medical and/or dental insurance program, (iii) 401(k) benefit plan, (iv) other
employee benefits that Employer may, in its sole discretion, make generally
available to employees of Employer of the same level and responsibility as
Employee.
2.4 Term. Employee's employment pursuant to this Agreement shall commence
on August 1, 2002, and shall continue in effect until July 31, 2004, unless
otherwise terminated in accordance with Section 2.5. The period of time during
which Employee remains employed by Employer pursuant to this Section 2.4 is
referred to herein as the "Term." This Agreement shall automatically renew for
successive periods of one (1) year beginning on the two-year anniversary date of
the commencement of the Term, unless either party hereto provides the other
party hereto with written notice, within no less than 30 days before the
expiration of the Term, of his or its intention not to extend the Term.
2.5 Termination of Employment.
(a) Disability.
(i) If during the term of this Agreement, the Employee should be prevented
from performing his duties by reason of Disability for a continuous period
greater than 180 days, Employer may terminate the Employee's employment
hereunder by giving written notice thereof to the Employee, effective on the
date set forth in the notice (which date shall be not less than 15 business days
after the notice is given). For purposes hereof, a continuous period of
incapacity
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shall not be deemed interrupted until the Employee returns to substantially full
time work for a period of at least 30 days.
(ii) If termination of employment results or occurs due to Disability under
this Section 2.5(a), Employee shall receive no other compensation hereunder;
provided, however, that until Employee receives disability insurance payments
under Employer's disability insurance coverage, Employee shall receive his
Salary. All Options held by Employee under the Plan (or any successor thereto)
shall vest immediately upon the date of termination for Disability.
(b) Death.
(i) In the event of the Employee's death during the term of this Agreement,
the Employee's employment hereunder shall be deemed terminated as of the date of
the Employee's death. Employee's family shall be entitled to receive a lump-sum
amount equal to sum of Employee's accrued but unpaid Salary through the date of
death and the appropriate payment in lieu of accrued but unused vacation time
through the date of death, as well as fully paid health and dental insurance
coverage for nine (9) months after Employee's death. In addition, all Options
held by Employee under the Plan or any successor thereto shall vest immediately
upon the date of death.
(c) Cause.
(i) This Agreement and the Employee's employment hereunder may be
terminated at any time by IFX for Cause.
(ii) If the Employee's employment is terminated by IFX for Cause or
Employee terminates his employment other than by reason of death, Disability or
an Involuntary Termination, Employee shall be entitled to no additional payments
hereunder and Employee's Options shall be treated as required under the Plan;
provided, however, that in the event Employee terminates his employment other
than by reason of death, Disability or an Involuntary Termination, Employee
shall be entitled to receive a lump-sum amount equal to the sum of Employee's
accrued but unpaid Salary through the date of such termination and the
appropriate payment in lieu of accrued but unused vacation time through the date
of termination.
(d) Involuntary Termination; Change of Control.
(1) In the event of (X) an Involuntary Termination on or after April 1,
2003; or (Y) an Involuntary Termination which occurs within one year after
a Change in Control; or (Z) Employer's failure to renew this Agreement upon
expiration of the then applicable Term, within one year after a Change in
Control, Employee shall receive the following from the Employer in complete
satisfaction of Employer's obligation to Employee under this Agreement:
(i) a lump-sum amount equal to Employee's accrued but unpaid Salary through
the date of termination;
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(ii) continuation of Employee's Salary on a semi-monthly basis for nine (9)
months after the date of Employee's termination (but without any regard to
payments due under Section 2.2(b) hereof immediately after the date of
termination);
(iii) continuation of the benefits specified in Section 2.3(b) to which
Employee is entitled as of the date of termination for nine (9) months, it being
understood that the Employer shall be responsible for the payment of premiums
and contributions to the extent it made such payments and contributions on or
before the date of termination;
(iv) immediate vesting of all options held by Employee under the Plan or
any successor thereto; and
(v) payment in lieu of accrued but unused vacation time through the date
of termination.
(2) In the event of an Involuntary Termination on or before March 31,
2003, Employee shall receive the following from the Employer in complete
satisfaction of Employer's obligation to Employee under this Agreement:
(i) a lump-sum amount equal to Employee's accrued but unpaid Salary
through the date of Involuntary Termination; and
(ii) payment in lieu of accrued but unused vacation time through the date
of Involuntary Termination.
ARTICLE III
COVENANTS AND AGREEMENTS
3.1 Records and Confidential Data.
(a) Employee acknowledges that, in connection with the performance of his
duties hereunder, Employer and its Affiliates will make available to Employee,
and/or Employee will have access to, certain Confidential Information (as
defined below) of Employer and its Affiliates. Employee acknowledges and agrees
that any and all Confidential Information learned or obtained by Employee during
the course of his employment by Employer or otherwise, whether developed by
Employee alone or in conjunction with others or otherwise, shall be and is the
property of Employer and its Affiliates. Employee shall keep all Confidential
Information confidential and shall not use any Confidential Information in any
manner other than in connection with Employee's discharge of his duties
hereunder.
(b) Following the first to occur of the termination of Employee's
employment hereunder, or as soon as reasonably possible after Employer's written
request, Employee shall return to Employer all written Confidential Information
which has been provided to Employee and, only to the extent not prohibited by
law, Employee shall destroy all copies of any analyses, compilations, studies or
other documents prepared by Employee or for Employee's use containing or
reflecting any Confidential Information. Within five (5) business days after
receipt of such request by Employee, Employee shall, upon written request of
Employer, deliver to
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Employer a notarized document certifying that such written Confidential
Information has been returned or destroyed in accordance with this Section
3.1(b).
(c) For purposes of this Agreement, "Confidential Information" shall mean
all confidential and proprietary information of Employer and/or its Affiliates,
including, without limitation, confidential and proprietary information that is
derived from or regarding reports, investigations, experiments, research, trade
secrets, work in progress, web site drawing, designs, plans, proposals, requests
for proposals, bids, codes, marketing and sales programs, acquisition targets or
strategies, information regarding subscribers or web site viewers, client lists,
client mailing lists, supplier lists, financial projections, cost summaries,
payor information, pricing formulae, marketing studies relating to prospective
business opportunities and all other confidential and proprietary materials or
information prepared for or by Employer and/or any of its Affiliates. For
purposes of this Agreement, Confidential Information shall not include and
Employee's obligations under this Section 3.1 shall not extend to information
which is generally available to the public or (ii) information which is required
to be disclosed by law or legal process (after giving Employer prior written
notice thereof and an opportunity to contest such disclosure to the extent
reasonably practicable).
(d) The provisions of this Section 3.1 shall survive termination of this
Agreement for any reason.
3.2 Inventions and Other Matters.
(a) Employee agrees that all inventions, discoveries or improvements made
during the period of Employee's employment with Employer, including, without
limitation, computer software (including source code, operating systems and
specifications, data, data bases, files documentation and other materials
related thereto), HTML or other scripts, web site designs, art work, visual
images, programming code and programs, processes, uses, apparatuses, specialized
information relating in any way to or that is useful in the business or products
of Employer or Employer's actual or demonstrably anticipated research or
development, designs or compositions of any kind that Employee, individually or
with others, may originate or develop while employed by Employer (collectively,
"Inventions"), belong to and shall be the sole property of Employer and
constitute and shall constitute works specially ordered or commissioned as
"works made for hire" under the United States Copyright Act and other applicable
law. Without limiting the foregoing, Employee hereby assigns and transfers to
Employer all rights of whatever nature that Employee may have, including,
without limitation, any patent, trade secret, trademark or service mark rights
(and any goodwill appurtenant thereto), any rights of publicity and any right,
title and interest in any copyright and any right that may affix under any
copyright law now or hereinafter in force and effect in the United States of
America or in any other country or countries, in and to any Invention. Employee
acknowledges and agrees that Employer shall have the royalty-free right to use
in its businesses, and to make and sell products, processes, programs, systems
designs, methods, formulas, apparatus, techniques, and services derived from any
Inventions (whether or not patentable or copyrightable), as well as all
improvements thereof or know-how related thereto. The provisions of this Section
3.2 shall survive termination of this Agreement for any reason.
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(b) For purposes of this Agreement, an Invention shall be deemed to
have been "made during the period of Employee's employment" if, during such
period, the Invention was conceived, in part or in whole, or first actually
reduced to practice. Employee agrees that any patent, copyright or trade mark
application (i) covering intellectual property that relates to services
performed by Employee hereunder or that is applicable to those products or
services of Employer that were within the scope of Employee's responsibilities
hereunder, and (ii) that is filed by or for the benefit of Employee or any of
his Affiliates within nine (9) months after termination of Employee's employment
shall be presumed to relate to an Invention made during the term of his
employment and Employee shall have the burden of proof to prove otherwise.
(c) This Section 3.2 shall not apply to an Invention for which no
equipment, supplies, facilities or Confidential Information (as defined below)
of Employer was used and that was developed entirely on Employee's own time,
unless (i) the invention relates or is applicable to the services performed by
Employee hereunder or that is applicable to those services or products of
Employer that were within the scope of Employee's responsibilities hereunder, or
(ii) results from any work relating to the Business that was performed, caused
to be performed, or supervised by Employee for or on behalf of Employer.
(d) Employee agrees, without further consideration, to (i) promptly
disclose each such Invention to Employer, to Employee's immediate supervisor and
to such other individuals as Employer may direct, (ii) execute and to join
others in executing such applications, assignments and other documents as may be
necessary or convenient to vest in Employer, or its designee, full title to each
such Invention and as may be necessary or convenient to obtain United States and
foreign patents and copyrights thereon, to the extent Employer may so choose in
its sole discretion, (iii) testify in any legal proceeding relative to such
Invention whenever requested to do so by Employer, upon reasonable notice and
provided Employer shall reimburse Employee for any reasonable related travel and
lodging expense, and (iv) furnish all facts relating to such Inventions or the
history thereof.
(e) Employee agrees that he will not at any time, except as authorized
or directed by Employer, publish or disclose any information or knowledge
concerning any Inventions.
3.3 Non-Competition.
(a) Employer and Employee recognize that Employee has been retained to
occupy a position of trust that constitutes part of the professional, management
and executive staff of Employer. Employee, for and in consideration of the
payments, rights and benefits provided herein, agrees that so long as he is
employed by Employer and, except in the event of an Involuntary Termination on
or before March 31, 2003, for a period of nine (9) months thereafter, Employee
shall not (i) work or act as an officer or director of or compensated consultant
to, (ii) assist, (iii) own, directly or through any Affiliate or joint venture,
a 10% or greater interest in, or (iv) make a financial investment (other than a
passive, economic investment), whether in the form of equity or debt, in any
business that is directly competitive with the Business in Latin America or in
any other non-United States market in which Employer is conducting the Business
at the time Employee's employment with Employer is terminated.
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(b) Notwithstanding the foregoing, nothing herein shall prohibit Employee,
during the period in which he is employed by the Employer, from holding two
percent (2%) or less of any class of voting securities of any entity whose
equity securities are listed on a national securities exchange or regularly
traded in the over-the-counter market and for which quotations are readily
available on the National Association of Securities Dealers Automated Quotation
system.
(c) If Employer terminates Employee's employment for Cause or if Employee
terminates his employment with Employer for any reason other than pursuant to an
Involuntary Termination, for a period of nine (9) months from and after the date
of termination, Employee shall promptly notify Employer of each employment or
agency relationship entered into by Employee, and each corporation,
proprietorship or other entity formed or used by Employee, the business of which
is directly competitive with the Business. The provisions of this Section 3.3
shall survive termination of this Agreement for any reason.
3.4 Non-Solicitation and Non-Interference.
(a) Employee acknowledges that Employer has invested substantial time and
effort in assembling its present staff of personnel. Employee agrees that so
long as he is employed by Employer and for a period of one year thereafter,
Employee shall not, directly or indirectly, employ, solicit for employment, or
advise or recommend to any other Person that such other Person employ or solicit
for employment, any of Employer's employees or recommend to any employee of
Employer that he/she cease to be employed by Employer; provided that the
restrictions set forth in the immediately preceding sentence shall not apply to
any solicitation directed at the public in general e.g., advertisements in
publications of general circulation, etc. or to inquiries for employment that
were unsolicited, directly or indirectly, by Employee.
(b) Employee acknowledges that all customers of Employer, which Employee
has serviced or hereafter services during Employee's employment by Employer and
all prospective customers from whom Employee has solicited or may solicit
business while in the employ of Employer, shall be solely the customers of
Employer. Employee agrees that so long as he is employed by Employer and for a
period of one year thereafter, Employee shall not either directly or indirectly
solicit business, as to products or services competitive with the Business, from
any of Employer's customers with whom Employee had direct contact during his
employment with Employer.
(c) Employee agrees that so long as he is employed by Employer and for a
period of one year thereafter, Employee shall not, directly or indirectly, (i)
intentionally disrupt or attempt to disrupt or terminate any relationship
between Employer and any of its Business suppliers, clients or employees, or
(ii) disparage, malign or discredit the name or reputation of Employer to any
customers, clients or suppliers of the Business. Employee agrees that during
such one year period, he will not influence or attempt to influence any of the
customers or clients of Employer to cease doing business with Employer.
3.5 Restrictions Reasonable. Employee agrees that the restrictions
contained in Sections 3.3 and 3.4 are reasonable as to time and geographic scope
because of the nature of the
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Business and Employee agrees, in particular, that the geographic scope of this
restriction is reasonable because companies in the same industry as the Business
compete on an international basis. Employee acknowledges that Employer is in
direct competition with all other companies that provide services and products
similar to the Business products and services throughout Latin America and,
because of the nature of the Business, Employee expressly agrees that the
covenants contained in Sections 3.3 and 3.4 cannot reasonably be limited to any
smaller geographic area. The provisions of Sections 3.3 and 3.4 shall survive
termination of this Agreement for any reason.
3.6 Prior Obligations. Employee represents and warrants that (a) Employee
has no obligation of confidence or other commitments to any previous employer or
any others that conflict with this Agreement or restrict Employee's field of
activities, and (b) no other agreement to which Employee is subject will
conflict with, prevent, be breached by, interfere with or in any manner affect
the terms and conditions of this Agreement.
3.7 Injunctive Relief. Employee acknowledge that damages would be an
inadequate remedy for Employee's breach of any of the provisions of Sections
3.1, 3.2, 3.3 and/or 3.4 of this Agreement, and that breach of any of such
provisions will result in immeasurable and irreparable harm to Employer.
Therefore, in addition to any other remedy to which Employer may be entitled by
reason of Employee's breach or threatened breach of any such provision, Employer
shall be entitled to seek and obtain a temporary restraining order, a
preliminary and/or permanent injunction, or any other form of equitable relief
from any court of competent jurisdiction restraining Employee from committing or
continuing any breach of such Section, without the necessity of posting a bond.
It is further agreed that the existence of any claim or cause of action on the
part of Employee against Employer, whether arising from this Agreement or
otherwise, shall in no way constitute a defense to the enforcement of the
provisions of Sections 3.1, 3.2, 3.3 and/or 3.4 of this Agreement.
ARTICLE IV
MISCELLANEOUS
4.1 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given (a) when made, if delivered personally, (b)
three business days after being mailed by certified or registered mail, postage
prepaid, return receipt requested, or (c) two business days after delivery to a
reputable overnight courier service, to the parties, their successors in
interest or their assignees at the following addresses, or at such other
addresses as the parties may designate by written notice in the manner
aforesaid:
To Employer: IFX Corporation
IFX Communications Ventures, Inc.
15050 NW 79/th/ Court
Suite 200
Miami Lakes, FL 33016
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To Employee, to his home address as recorded in the payroll records of
Employer from time to time.
4.2 Governing Law. This Agreement shall be governed as to its validity and
effect by the internal laws of the State of Florida, without regard to its rules
regarding conflicts of law.
4.3 Agreement To Arbitrate.
(a) Employer and Employee agree that any disputes that arise between
Employee and Employer (or any of Employer's officers, directors, stockholders,
supervisors, employees, agents, Affiliates or successors), excluding disputes
arising out of Section 3.1, 3.2, 3.3 or 3.4, that cannot be resolved informally
shall be decided by submission of the dispute to binding arbitration before a
sole neutral arbitrator who is a retired federal judge pursuant to the American
Arbitration Association Commercial Arbitration Rules governing such proceedings,
and not by a lawsuit or by resort to court process, except as specifically set
forth below. Both parties acknowledge and agree that they are giving up their
respective constitutional rights to have any such dispute decided in a court of
law before a jury, and instead are accepting the use of the arbitration process.
This Section 4.3(a) applies to any and all disputes, including, by way of
example only and not limited to, disputes regarding termination of Employee's
employment; discrimination and unlawful harassment of any kind (including,
without limitation, claims arising under Title VII of the Civil Rights Act of
1964, as amended, 42 U.S.C. (S)2000(e) et seq. and the Civil Rights Act of 1991;
the Age Discrimination in Employment Act, as amended, 29 U.S.C. (S)621, et seq.;
the Americans with Disabilities Act of 1990, 42 U.S.C. (S)12101 et seq.; the
Family and Medical Leave Act of 1993, 29 U.S.C. (S)2612 et seq.; and all
applicable state and local anti-discrimination laws and constitutional
provisions); disputes arising under any other applicable federal, state or local
labor statutes, regulations or orders; disputes regarding assault and battery;
negligent supervision; defamation; invasion of privacy; wages and overtime; and
disputes regarding the formation and enforceability of this Section 4.3(a). The
following types of disputes are excluded from the scope of coverage of this
Section 4.3(a): (i) workers' compensation claims by Employee for on-the-job
injuries; and (ii) any and all claims by Employer against Employee, including
claims for injunctive relief, arising out of Employee's breach or threatened
breach of Section 3.1, 3.2, 3.3 or 3.4 of this Agreement.
(b) General Rules of Arbitration. Either party shall have the right to have
counsel represent him/it at the arbitration hearing and in pre-arbitration
proceedings. Pre-arbitration discovery shall be permitted in accordance with the
Federal Rules of Civil Procedure, except that (i) there shall be no limit on the
number of depositions that may be noticed by either party, and (ii) in
connection with any pre-arbitration disclosure of expert testimony in accordance
with Rule 26(a)(2), the timing of the expert disclosure shall be set by the
arbitrator.
(c) Authority of Arbitrator. The arbitrator shall have the authority to (i)
resolve any discovery disputes that arise between the parties; (ii) resolve any
dispute relating to the interpretation, applicability or enforceability of this
Section 4.3; and (iii) entertain a motion to dismiss and a motion for summary
judgment, applying the standards governing such motions under Federal Rule Of
Civil Procedure 12(b)(6) and Rule 56. The arbitrator is required to render
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his decision in writing, with an opinion stating the bases of his decision.
Either party has the right to file a post-arbitration brief, which shall be
considered by the arbitrator.
(d) Payment of Costs and Fees. Each party shall bear its own costs and
attorneys' fees incurred in connection with the arbitration. The arbitrator
shall have the discretion to award costs to the prevailing party. The
arbitrator's fees shall be borne equally by the parties. Each party shall post
his or its portion of the arbitrator's anticipated fee prior to the commencement
of the arbitration.
(e) Appeals. Either side shall have the right to appeal the arbitrator's
decision by applying to a Court (as defined in Section 4.4) for an order
vacating the award for any of the reasons set forth in 9 U.S.C. ss.10, or on the
basis that the arbitrator has made a mistake of law or fact. The arbitration
decision shall stand if it is supported by substantial evidence.
4.4 Jurisdiction; Service of Process. Each of the parties hereto agrees
that any action or proceeding initiated or otherwise brought to judicial
proceedings by either Employee or Employer concerning the subject matter of this
Agreement that is not subject to Section 4.3, shall be litigated in the federal
or state courts of the State of Florida covering Miami, Dade County, Florida
(the "Courts"). Each of the parties hereto expressly submits to the jurisdiction
and venue of the Courts. Each party hereto waives any claim that the Courts are
an inconvenient forum or an improper forum based on lack of venue or
jurisdiction. Each party shall bear its own costs and attorneys' fees incurred
in connection with any such actions or proceedings.
4.5 Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of (a) the heirs, executors and legal representatives of
Employee, upon Employee's death or incapacity, and (b) any successor of
Employer, and any such successor shall be deemed substituted for Employee or
Employer, as the case may be, under the terms hereof for all purposes; provided,
however, that any such assignment shall not relieve Employer from its
obligations hereunder. As used in this Agreement, "successor" shall include any
Person that at any time, whether by purchase, merger, consolidation or
otherwise, directly or indirectly acquires a majority of the assets, business or
stock of Employer.
4.6 Integration. This Agreement, the Plan and any option agreement Employee
will be required to execute, constitute the entire agreement between the parties
with respect to all matters covered herein, including but not limited to the
parties' employment relationship and Employee's entitlement to compensation,
commissions and benefits from Employer or any of its Affiliated companies and/or
the termination of Employee's employment. This Agreement supersedes all prior
oral or written understandings and agreements relating to its subject matter and
all other business relationships between Employer and/or its Affiliated
companies.
4.7 No Representations. No Person has made or has the authority to make any
representations or promises on behalf of any of the parties which are
inconsistent with the representations or promises contained in this Agreement,
and this Agreement has not been executed in reliance on any representations or
promises not set forth herein.
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4.8 Amendments. This Agreement may be modified only by a written
instrument executed by the parties that is designated as an amendment to this
Agreement.
4.9 Counterparts. This Agreement is being executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
4.10 Severability and Non-Waiver. Any provision of this Agreement (or
portion thereof) which is deemed invalid, illegal or unenforceable in any
jurisdiction shall, as to that jurisdiction and subject to this Section, be
ineffective to the extent of such invalidity, illegality or unenforceability,
without affecting in any way the remaining provisions thereof in such
jurisdiction or rendering that or any other provisions of this Agreement
invalid, illegal, or unenforceable in any other jurisdiction. If any covenant
should be deemed invalid, illegal or unenforceable because its scope is
considered excessive, such covenant shall be modified so that the scope of the
covenant is reduced only to the minimum extent necessary to render the modified
covenant valid, legal and enforceable.
4.11 Voluntary and Knowledgeable Act. Employee represents and warrants that
he has been represented by independent legal counsel of his own choosing and
that he has read and understands each and every provision of this Agreement and
has freely and voluntarily entered into this Agreement.
4.12 Late Payments. If the Employer fails to pay any amount provided under
this Agreement or any other plan or program sponsored by Employer when due, the
Employer shall pay interest on such amount at a rate equal to (i) the highest
rate of interest charged by the Employer's principal lender plus 200 basis
points, or (ii) in the absence of such a lender, 300 basis points over the prime
commercial lending rate announced by Harris Trust and Savings Bank on the date
such amount is due or, if no such rate shall be announced on such date, the
immediately prior date on which Harris Trust and Savings Bank announced such a
rate; provided, however, that if the interest rate determined in accordance with
this Section exceeds the highest legally-permissible interest rate, then the
interest rate shall be the highest legally-permissible interest rate.
4.13 Required Approvals. This Agreement shall not be enforceable by
Employee against Employer until this Agreement is approved by both: (a) the
Board of Directors of Employer; and (b) the requisite shareholders of Employer.
The Employer shall notify Employee in writing (including, without limitation, by
way of e-mail) promptly after such approval has been obtained.
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IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
as of the date first above written.
EMPLOYER:
IFX CORPORATION
By: /s/ Joel Eidelstein
-----------------------
Name: Joel Eidelstein
Title: President
Date: 8/1/02
EMPLOYEE:
/s/ Howard F. Zuckerman
--------------------------------
Howard F. Zuckerman
Date: 8/1/02
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EXHIBIT A TO
EMPLOYMENT AGREEMENT
Option Grants
A. Each Option granted to Employee pursuant to this Employment
Agreement shall be subject to, and exercisable in accordance with, the terms and
conditions set forth in the Plan and the Option Agreement.
B. The following Options granted pursuant to this Employment Agreement
shall be granted as of August 1, 2002 (the "First Option Date") and shall be
evidenced by the Option Agreement, and containing the following terms:
Number
of Options Exercise Price Vesting Period
---------- -------------- --------------
300,000 Closing Ask Price 100,000 on August 1, 2003;
on the First Option Date 25,000 vesting on November
1, 2003, and 25,000 every
three months thereafter,
until such time as all
300,000 Options shall have
vested.
The following Options granted pursuant to this Employment Agreement shall be
granted as of January 1, 2003 (the "Second Option Date") and shall be evidenced
by an option agreement between IFX and Employee in the form of the Option
Agreement, and containing the following terms:
Number
of Options Exercise Price Vesting Period
---------- -------------- --------------
115,719 Closing Ask Price 38,573 on August 1, 2003;
on the Last Trading Day 19,287 vesting on November
prior to the Second 1, 2003; 19,287
Option Date vesting on February 1,
2004; 19,286 vesting on
May 1, 2004; and 19,286
vesting on August 1, 2004.