Exhibit 10.2
AMENDMENT NO. 1 TO SEPARATION AGREEMENT
     This Amendment No. 1 to Separation Agreement is made this 4th day of
December 2008, by and between James Pluntze (the “Employee”) and NaviSite, Inc.
(the “Company”).
     Whereas, the Employee and the Company are parties to a Separation Agreement
dated July 31, 2007 (the “Separation Agreement”); and
     Whereas, the Employee and the Company desire to amend the Separation
Agreement as set forth herein;
     Now, therefore, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. The Employee shall pay ten dollars ($10) to the Company in return for its
agreement to the changes to the Separation Agreement as set forth herein.
2. The Separation Agreement is hereby amended to add the following Section 3(d):
“(d) Payments to the Employee under Section 3 shall be bifurcated into two
portions, consisting of the portion, if any, that includes the maximum amount of
the payments that does not constitute “nonqualified deferred compensation”
within the meaning of Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”), and the portion, if any, that includes the excess of the
total payments that does constitute nonqualified deferred compensation. Payments
hereunder shall first be made from the portion that does not consist of
nonqualified deferred compensation until such portion is exhausted and then
shall be made from the portion that does constitute nonqualified deferred
compensation. Notwithstanding the foregoing, if the Employee is a “specified
employee” as defined in Section 409A(a)(3)(B)(i) of the Code, the commencement
of the delivery of the portion that constitutes nonqualified deferred
compensation will be delayed to the date that is 6 months and one day after the
Employee’s termination of employment (the “Earliest Payment Date”). Any payments
that are delayed pursuant to the preceding sentence shall be paid pro rata
during the period beginning on the Earliest Payment Date and ending on the date
that is 6 months following the Earliest Payment Date. The determination of
whether, and the extent to which, any of the payments to be made to the Employee
hereunder are nonqualified deferred compensation shall be made after the
application of all applicable exclusions under Treasury Reg. § 1.409A-1(b)(9).
Any payments that are intended to qualify for the exclusion for separation pay
due to involuntary separation from service set forth in Treasury
Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the last day
of the second taxable year of the Employee following the taxable year of the
Employee in which the Employee’s termination of employment occurs.
3. Section 1(e) of the Separation Agreement is hereby amended to add the
following Section 1(e)(vii):
“(vii) In order to establish “Good Reason” for a termination, the Employee must
provide notice to the Company of the existence of the condition giving rise to
the “Good Reason” within 90 days following the initial existence of the
condition, and the Company has 30 days following receipt of such notice to
remedy such condition.”
4. Section 1(a) of the Separation Agreement is hereby amended and restated in
its entirety to read as follows:
“(d) “Change of Control” shall mean the first to occur of any of the following:
     (A) the acquisition by an individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the
“Exchange Act”)) (a “Person”) of beneficial ownership of any capital stock of
the Company if, after such acquisition, such Person beneficially owns (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) 50% or more of
either (x) the then-outstanding shares of common stock of the Company (the
“Outstanding Company Common Stock”) or (y) the combined voting power of the
then-outstanding securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting

 

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Securities”); provided, however, that for purposes of this subsection (A), any
acquisition directly from the Company shall not constitute a Change in Control;
or
     (B) such time as the Continuing Directors (as defined below) do not
constitute a majority of the Board (or, if applicable, the Board of Directors of
a successor corporation to the Company), where the term “Continuing Director”
means at any date a member of the Board (x) who was a member of the Board on the
date of the initial adoption of this Plan by the Board or (y) who was nominated
or elected subsequent to such date by at least a majority of the directors who
were Continuing Directors at the time of such nomination or election or whose
election to the Board was recommended or endorsed by at least a majority of the
directors who were Continuing Directors at the time of such nomination or
election; provided, however, that there shall be excluded from this clause
(y) any individual whose initial assumption of office occurred as a result of an
actual or threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents, by
or on behalf of a person other than the Board; or
     (C) the consummation of a merger, consolidation, reorganization,
recapitalization or share exchange involving the Company or a sale or other
disposition of all or substantially all of the assets of the Company (a
“Business Combination”), unless, immediately following such Business
Combination, each of the following two conditions is satisfied: (x) all or
substantially all of the individuals and entities who were the beneficial owners
of the Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such Business Combination beneficially own,
directly or indirectly, more than 50% of the then-outstanding shares of common
stock and the combined voting power of the then-outstanding securities entitled
to vote generally in the election of directors, respectively, of the resulting
or acquiring corporation in such Business Combination (which shall include,
without limitation, a corporation which as a result of such transaction owns the
Company or substantially all of the Company’s assets either directly or through
one or more subsidiaries) (such resulting or acquiring corporation is referred
to herein as the “Acquiring Corporation”) in substantially the same proportions
as their ownership of the Outstanding Company Common Stock and Outstanding
Company Voting Securities, respectively, immediately prior to such Business
Combination and (y) no Person (excluding any employee benefit plan (or related
trust) maintained or sponsored by the Company or by the Acquiring Corporation)
beneficially owns, directly or indirectly, 40% or more of the then-outstanding
shares of common stock of the Acquiring Corporation, or of the combined voting
power of the then-outstanding securities of such corporation entitled to vote
generally in the election of directors (except to the extent that such ownership
existed prior to the Business Combination); or
     (D) the liquidation or dissolution of the Company.”
     Notwithstanding anything to the contrary, the following acquisitions shall
not constitute a Change in Control event: (A) any acquisition directly from the
Company (excluding an acquisition pursuant to the exercise, conversion or
exchange of any security exercisable for, convertible into or exchangeable for
common stock or voting securities of the Company, unless the Person exercising,
converting or exchanging such security acquired such security directly from the
Company or an underwriter or agent of the Company), (B) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company, (C) any acquisition by any
corporation pursuant to a Business Combination (as defined below) which complies
with clauses (x) and (y) of subsection (iii) of this definition or (D) any
acquisition by ClearBlue Technologies, Inc. or its affiliates, including
Atlantic Investors, LLC, or Waythere, Inc. (each such party is referred to
herein as “ClearBlue”) of any shares of common stock.
4. Section 7 of the Separation Agreement is hereby amended to add the following
Section 7(g):
“(g) Section 409A. This Agreement is intended to comply with the provisions of
Section 409A and the Agreement shall, to the extent practicable, be construed in
accordance therewith. Terms defined in the Agreement shall have the meanings
given such terms under Section 409A if and to the extent required in order to
comply with Section 409A. No payments to be made under this Agreement may be
accelerated or deferred except as specifically permitted under Section 409A. In
the event that the Agreement shall be deemed not to comply with Section 409A,
then neither the Company, the Board

 

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nor its or their designees or agents shall be liable to the Employee or other
person for actions, decisions or determinations made in good faith.
5. In all other respects, the Separation Agreement is hereby ratified and
confirmed.
*****

 

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     IN WITNESS HEREOF, the parties hereto have executed this Amendment No. 1 to
Separation Agreement as of the day and year first set forth above.

                  NAVISITE, INC.    
 
           
 
  By:   /s/ Arthur Becker
 
   
 
  Name:   Arthur Becker    
 
  Title:   Chief Executive Officer    
 
           
 
  EMPLOYEE  
 
                /s/ James W. Pluntze                   Name: James W. Pluntze