Employment Agreement - SAVVIS Communications Corp. and David J. Frear
June 14, 1999
By Facsimile (301) 656-2025
Mr. David J. Frear
[Address]
Dear David:
I am authorized by Thomas Wendel to confirm an offer of employment as Chief
Financial Officer of SAVVIS Communications Corporation, a wholly owned
subsidiary of Bridge Information Systems, Inc. (Bridge). The terms of this
offer, which are not subject to approval by the Board of Directors of Bridge,
are outlined in the attached Term Sheet dated June 14, 1999. There are three
changes from the previous term sheet identified in bold letters. I believe you
will understand the need for these changes, but please call me if you have any
questions. I will be in my office until 5:00 p.m. CDT. You can reach me after
that time on my cell phone.
Should these terms and conditions be acceptable to you, please sign below and
return.
Sincerely,
/s/Daryl Rhodes
---------------
Daryl Rhodes
EVP and Chief Financial Officer
/s/: David J. Frear 15/6/99
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Accepted: David J. Frear Date
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DAVID J. FREAR
TERM SHEET
JUNE 14, 1999
POSITION Chief Financial Officer
SALARY $250,000 subject to periodic review and
adjustment.
BONUS 50% of salary. May be more or less based on
individual and corporate performance.
BENEFITS Medical, disability, life insurance, 401K and
other benefits in accordance with company policy.
VACATION 4 weeks/year
OPTIONS Options on .5% of the fully diluted shares of
Savvis (post-acquisition of the Bridge network
assets) at an exercise price per share based on a
$40 million equity valuation (subject to
validation of this valuation by the Company's
appraisers and accounting experts). Upon the
closing of an initial public offering of Savvis
additional options representing .25% of the fully
diluted shares of Savvis will be issued with an
exercise price per share equal to the IPO price.
All options will have a 10 year term, will be
incentive stock options to the extent permitted by
law, and the underlying shares will be registered
promptly following any public offering of the
Company's common stock.
VESTING One quarter on the earlier of an initial public
offering or the first anniversary of employment,
and one quarter on each of the second, third, and
fourth anniversaries of employment.
ACCELERATION All unvested options shall vest immediately prior
to the occurrence of a Change in Control. Change
of Control shall include (i) the acquisition by a
person, or persons acting as a group, of 35% or
more of the Company's outstanding voting stock
(EXCLUDING DISTRIBUTIONS OF SAVVIS STOCK TO BRIDGE
SHAREHOLDERS), (ii) the disposal of all or
substantially all of the Company's assets or
business through a sale, lease or otherwise, (iii)
the merger of the Company with or into another
person where the Company is not the surviving
person, (iv) any reverse merger in which the
Company's stockholders prior to the merger do not
own at least 50% of the post merger entity, (v) a
change in the board of directors in any two year
period
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DAVID J. FREAR
TERM SHEET
JUNE 14, 1999
PAGE 2
wherein a majority of the directors have been
elected without the approval of at least 2/3 of
the directors in office at the beginning of such
period, or (vi) a Change in Control of Bridge, in
the event Bridge owns more than 35% of the
Company's outstanding voting stock (EXCLUDING
DISTRIBUTIONS OF BRIDGE SHARES OWNED BY
PARTNERSHIPS CONTROLLED BY WELSH, CARSON, ANDERSON
& STOWE TO THE LIMITED PARTNERS OF SUCH
PARTNERSHIPS).
EXPIRY All vested options shall terminate as follows:
i) at the end of their ten year term
ii) 2 years following termination of employment
due to death or disability
Vesting shall cease as of the date of termination
of employment, except as otherwise provided
herein.
SEVERANCE If at any time the Company shall terminate the
employee's employment, other than for Cause
(felony conviction, moral turpitude), or if the
employee terminates his employment for Good Reason
(substantial reduction in pay or responsibilities,
change in principal location from DC metropolitan
area, failure of Savvis to acquire the Bridge
network assets by 12/31/00), the employee will be
entitled to continuation of salary and all
benefits (including continued vesting of options)
for one year following such termination, and will
be entitled to a pro rata payment of bonus through
the date of termination.
LOCATION Employee's principal office will be located in
Reston, VA.
PUT RIGHT If the Company's common stock is not traded on a
national securities market with a public float of
at least $75 million AND THE COMPANY IS NOT
ACTIVELY IN THE PROCESS OF REGISTERING ITS COMMON
STOCK ON A NATIONAL SECURITIES MARKET WITH A
PUBLIC FLOAT OF AT LEAST $75 MILLION within 2
years ("Publicly Traded") of commencement of
employment, employee will have the right to put
the shares underlying all vested options to the
Company in exchange for a cash payment equal to
the fair market value of such shares less the
exercise price of such shares. Fair market value
will be determined by an internationally
recognized investment bank of a fully distributed
public basis without regard to illiquidity
discounts, minority interest discounts, control
premiums or the existence
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DAVID J. FREAR
TERM SHEET
JUNE 14, 1999
PAGE 3
of control blocks. This right will expire when the
Company's stock is Publicly Traded.
BOARD The Company will use its best efforts to cause
REPRESENTATION employee to be elected to its Board of Directors.
Employee will continue in such position at the
discretion of the Board and the Company's
shareholders.