Exhibit
10.20
EMPLOYMENT
AGREEMENT
Employment Agreement (this "Agreement") dated as
of February 1, 2004 (the "Effective Date"), by and between Internap
Network Services Corporation (the "Company") and David Buckel
("Executive") (collectively the "Parties").
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1. Position and Duties
. Executive shall serve as the
Financial Vice President, for the Company, with such duties,
authorities and responsibilities as are commensurate with such
position. Executive shall report to the Company's Chief Financial
Officer (“CFO”) and shall work from the Company's
offices in Atlanta, Georgia.
2. Base Salary. Executive shall receive an annual base salary of
$ 160,000.00 ("Base Salary"). Payment of Base Salary shall be
subject to standard payroll tax withholdings and deductions.
Executive's Base Salary shall be paid semi-monthly in accordance
with the Company's standard payroll practices. Executive's Base
Salary may be increased or decreased from time to time by the CFO
in consultation with the Company's Board of Directors or the
Compensation Committee of such Board of Directors (in either case,
the "Board") in their sole discretion.
3. Performance-Based Bonus
. While the Company has not decided
to implement a bonus plan (“Bonus”) for Executive and
other senior executive officers at this time, should it do so in
the future its present intention is that Executive’s Bonus
would be from 35% to up to 50% of Executive's Base Salary, prorated
if less than a full year. Performance metrics for the Bonus, if
any, for 2004 shall be established by the CFO in consultation with
the Board and in their sole and reasonable discretion as soon as
practicable after a determination has been made to implement a
Bonus plan for Executive and other senior executive officers.
Performance metrics for and target amount of the Bonus for 2005 and
each subsequent calendar year shall be established on or before
February 28 of the year to which the Bonus relates. The CFO, in
consultation with the Board and in their sole and reasonable
discretion, shall determine, on or before February 28 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 and shall
be subject to standard payroll tax withholdings and deductions. 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 Company and Executive
acknowledge that the Company will issue to Executive one or more
options to purchase 200,000 shares of the Company’s common
stock, subject to the terms and conditions of the relevant option
plan(s) and related stock option agreement(s) (the "Options") no
later than March 31, 2004. The Board, upon the recommendation of
the CFO and in their sole discretion, may award additional options
or equity or other equity-based compensation to Executive on terms,
in amounts and subject to performance goals as determined by the
CFO and the Board (any such options also being referred to
hereinafter as “Options” and any such equity or
equity-based compensation being referred to herein as
“Additional Equity Compensation”).
5. Employee Benefits.
Executive shall be entitled to
participate in all employee benefit, welfare and other plans and
programs generally applicable to employees of the Company. Except
as provided herein, the Company reserves the right to modify
Executive's compensation and benefits from time to time, as it
deems necessary.
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 any
other 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.
8. Severance Payments.
Upon Executive's involuntary
termination by the Company of employment without Cause (as defined
below), Executive shall receive a cash severance payment equal to
the product of (x) the number of days that Executive is am employee
of the Company, divided by 365 (provided that the foregoing ratio
shall never exceed one (1) and (y) Executive’s then-current
Base Salary. Payment of such severance amounts shall be subject to
standard payroll tax withholdings and deductions.
In addition to the severance benefits
provided above, upon Executive's involuntary termination of
employment without Cause, all of Executive’s unvested Options
and Additional Equity Compensation shall lapse and expire, and all
of Executive’s vested Options shall remain exercisable no
later than three months after the date of termination. No payment
or acceleration of Options or Additional Equity Compensation shall
be made pursuant to this Section 8 unless prior to or
concurrent with such payment a valid release has been executed and
delivered by Executive and becomes effective in accordance with
Section 11 hereof. 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.
9. Change in Control Payments and
Acceleration . Upon
Executive's involuntary termination of employment without Cause (as
defined below) or voluntary termination of employment for Good
Reason, in either case within 12 months
after a Change in Control, (i) the Company shall pay Executive a
cash severance payment equal to two time the sum of Executive's
then-current Base Salary and maximum target Bonus and (ii) all of
Executive’s unvested Options and Additional Equity
Compensation shall become vested, free of restrictions and
immediately exercisable for the remaining term of the relevant
grant or award.
Payment of such severance payments shall be
subject to standard payroll tax withholdings and
deductions.
No payment or acceleration of Options or
Additional Equity Compensation shall be made unless prior to or
concurrent with such payment a valid release has been executed and
delivered by Executive and becomes effective in accordance with
Section 11 hereof.
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 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; (ii)
A change in the composition of the Board such that the individuals
who, as of the Effective Date, constitute the Board (such Board
shall be hereinafter referred to as the "Incumbent Board"),
excluding the current members of the Board (“Series A
Directors”) who have been elected pursuant to the terms of
the Company’s Series A Convertible Preferred Stock
(“Series A Stock”), 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 Effective Date, 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), excluding
the Series A Directors, 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
