Exhibit 10.1


    
      

    

    Exhibit
      10.1

    EMPLOYMENT
      AGREEMENT

     

    This
      Employment Agreement (this "Agreement") is entered into as of April 2, 2007,
      but
      to be effective as of April 16, 2007 (the "Effective Date"), by and between
      Internap Network Services Corporation (the "Company" or "Internap") and Vincent
      Molinaro ("Executive") (collectively the "Parties"). 

     

    1. Position
      and Duties.
      Executive shall serve as Chief Operating Officer for the Company, with such
      duties, authorities and responsibilities as are commensurate with such position.
      Executive shall work from the Company’s offices in Atlanta,
      Georgia.

     

    2. Base
      Salary.
      Executive shall receive an annual base salary of $350,000 ("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 from time to time by the Company's Chief Executive Officer (“CEO”) and
      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
      and absolute discretion.

     

    3. Performance-Based
      Bonus. Executive
      will be eligible to participate in Internap’s annual incentive bonus plan as in
      effect for any calendar year during the Term ("Incentive Plan"). Executive’s
      entitlement to a bonus under the Incentive Plan will be based on the Company’s
      achievements of its goals and Executive’s individual performance, as determined
      by the Company or the Board, as the case may be, in their sole and absolute
      discretion. Executive’s initial bonus opportunity under the Incentive Plan will
      be up to 50% of Executive’s annual Base Salary, subject to the terms and
      conditions of the Incentive Plan and pro-rated for the length of your employment
      during the applicable Incentive Plan year.

     

    4. One-time
      Signing Bonus.
      The
      Company will make a one-time signing bonus payment to Executive in the total
      amount of $20,000, which shall be payable in twelve (12) equal monthly
      installments during the course of Executive’s first year of employment. The
      one-time signing bonus payment under this Section 4 will not be considered
      as
      part of Executive’s Base Salary, bonus potential under the Incentive Plan or
      other compensation programs or severance amounts. Notwithstanding anything
      to
      the contrary contained in this Agreement, if Executive voluntarily terminates
      his employment with the Company without Good Reason (as defined below) within
      twelve (12) months from the Effective Date, Executive shall immediately repay
      to
      the Company the full amount of this one-time signing bonus that has theretofore
      been paid to Executive.

     

    5. Equity
      Compensation.
      The
      Company and Executive acknowledge that the CEO shall recommend to the Board
      that
      the Company issue to Executive 125,000 restricted shares of the Company’s common
      stock, which, if approved by the Board, shall vest in annual increments of
      25%
      commencing on the first anniversary of the date of issuance, subject to the
      terms and conditions of the relevant equity compensation plan(s) and related
      restricted stock agreement(s) (the "Restricted Shares"). 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    6. 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
      benefits from time to time, as it deems necessary in its sole and absolute
      discretion, so long as Executive continues to receive healthcare and life
      insurance benefits that are comparable to other similarly situated
      employees.

     

    7. 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. 

     

    8. Relocation.
      Executive shall have a budget of (i) up to $100,000, including the tax gross-up
      that will be required, to be used for his relocation for expenses under
      Internap’s Domestic Relocation Program Benefits attached hereto as Exhibit A
      (the “Relocation Program”) other than for expenses set forth in Section 3.8 and
      3.8-1 of the Relocation Program and (ii) up to $50,000 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. Notwithstanding
      anything to the contrary contained in this Agreement, if Executive voluntarily
      terminates his employment with the Company without Good Reason within 12 months
      from the date of relocation, Executive shall promptly repay the Company the
      amount of all relocation expenses paid by the Company associated with
      Executive’s relocation to the Atlanta area no later than 30 days after such
      termination date.

     

    9. 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.

     

    10. Severance
      Payments.
      Upon
      Executive’s involuntary termination of employment by the Company without Cause
      (as defined below), Executive shall receive a cash severance payment equal
      to
      Executive’s then-current annual Base Salary. Payment of the severance amount set
      forth in this Section 10 shall be subject to standard payroll tax withholdings
      and deductions.  

     

    Upon
      Executive's involuntary termination of employment without Cause, all of
      Executive's unvested Restricted Shares, if any, shall cease vesting and shall
      be
      subject to repurchase and/or termination in accordance with the terms of the
      applicable restricted stock agreement. Notwithstanding anything contained herein
      to the contrary, Executive shall not be entitled to any benefits or rights
      under
      this Section 10 if Executive also is eligible for payments and/or benefits
      under
      Section 11 hereof.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    11. Change
      in Control Payments and Acceleration.
      If (i)
      a Change of Control (as defined below) occurs on or before the first anniversary
      of the Effective Date or (ii) Executive’s employment is involuntarily terminated
      by the Company without Cause or Executive voluntary terminates his employment
      for Good Reason, in either case within 12 months after
      a
      Change in Control, then (x) the Company shall pay Executive a cash severance
      payment equal to one and one-half (1.5) times the sum of Executive’s
      then-current annual Base Salary plus the maximum target Bonus under the
      Incentive Plan and (y) all of Executive’s unvested Restricted Shares, if any,
      shall become fully vested and free of restrictions.

     

    Payment
      of the payments set forth in this Section 11 shall be subject to standard
      payroll tax withholdings and deductions.

     

    If
      Executive is terminated pursuant to Section 11(ii) above, then 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 11 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 (the Company’s obligation
      to pay the premiums of such comparable coverages shall not exceed the amount
      the
      Company paid on behalf of Executive for the healthcare and life insurance
      coverages the Company provided to Executive in the month immediately preceding
      Employee’s termination (the “Monthly Coverage Limitation Amount”)) or pay
      Executive in a lump sum the costs of such coverages (subject to the Monthly
      Coverage Limitation Amount).

     

    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”), 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) 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.

     

    For
      purposes of this Agreement, “Cause” shall mean:

     

    (i)
      Executive’s conviction (including a plea of guilty or nolo contendere) 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)
      Executive’s willful and continued failure to perform his duties hereunder (other
      than such failure resulting from the Executive’s incapacity due to physical or
      mental illness or after the issuance of a notice of termination by the Executive
      for Good Reason) within ten (10) business days after the Company delivers to
      him
      a written demand for performance that specifically identifies the actions to
      be
      performed provided that such written demand is not unlawful or in violation
      of
      Executive’s fiduciary duties to the Company.

     

    For
      purposes of this Section 11, no act or failure to act by the Executive shall
      be
      considered a “gross omission”, “gross dereliction” or “willful” if such act is
      done by the Executive in the good faith belief that such act is or was to be
      beneficial to the Company or such failure to act is due to the Executive’s good
      faith belief that such action would be materially harmful to the
      Company.

     

    Executive
      shall not be deemed to have been terminated for “Cause” unless there shall have
      been delivered to him written notice, not less than ten (10) business days
      prior
      to the proposed termination date, specifying the basis for such termination;
      provided, however, that if clause (iv) above is the basis for such termination,
      then such termination shall be effective on the date such written notice is
      delivered to Executive.

     

    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;
      (ii) any significant reduction in Executive’s then current total
      compensation from that compensation paid by the Company in the prior fiscal
      year; (iii) a change of more than fifty (50) miles Executive's permanent
      workplace without Executive's consent, or (iv) any material breach of this
      Agreement by the Company. Executive shall not be deemed to have terminated
      this
      Agreement for “Good Reason” unless he shall have delivered to the Company
      written notice, not less than ten (10) business days prior to the proposed
      termination date, specifying the basis for such termination.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    12. Parachute
      Payments.
      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.

     

    13. 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 a form substantially similar
      in all material respects to the form of Release attached hereto as Exhibit
      B
      (but subject to such changes as the Company may deem reasonably necessary in
      order to take into account changes in applicable law) by which Executive
      releases the Company from any and all claims of any kind. Executive shall not
      receive any severance payments or benefits provided under this Agreement.


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    14. 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"). Executive will hold the
      Company’s Confidential Information in strict confidence, and not disclose or use
      it during the No Disclosure Term (as defined below), 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
      subject to the No Disclosure Term. 

     

    Executive
      agrees that if Executive breaches Section 14 of this Agreement: (i) the Company
      would suffer irreparable harm; (ii) it would be difficult to determine damages,
      and money damages alone would be an inadequate remedy for the injuries suffered
      by the Company, and (iii) if the Company seeks injunctive relief to enforce
      this
      Agreement, Executive will waive and will not (a) assert any defense that the
      Company has an adequate remedy at law with respect to the breach, (b) require
      that the Company submit proof of the economic value of any Trade Secret or
      Confidential Information, or (c) require the Company to post a bond or any
      other
      security.

     

    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. 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 Exhibits, 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.

     

    Executive
      agrees that any claim arising out of or relating to this Agreement shall be
      brought in a state or federal court of competent jurisdiction in Georgia.
      Executive consents to the personal jurisdiction of the state and/or federal
      courts located in Georgia. Executive waives (i) any objection to jurisdiction
      or
      venue, or (ii) any defense claiming lack of jurisdiction or improper venue,
      in
      any action brought in such courts.

     

    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.

     

    The
      Company shall reimburse Executive for the legal fees and expenses incurred
      by
      Executive in connection with the review and negotiation of this Agreement up
      to
      $5,000.

     

    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 as of the Effective
      Date.

    


    


    
      	
              INTERNAP
                NETWORK SERVICES

              CORPORATION

            	
              VINCENT
                MOLINARO

            
	
               

            	
               

            
	
              By:
                /s/
                James P.
                DeBlasio                                               

            	
              /s/
                Vincent Molinaro     

            
	
              Name:
                James P. DeBlasio

            	
               Vincent
                Molinaro

            
	
              Title:
                President & CEO