**Exhibit 10.38**

 

**AGREEMENT AND RELEASE OF CLAIMS**

 

THIS AGREEMENT ANDRELEASE OF CLAIMS (this “**Agreement**”)is made as of February 11th, 2005, between VIA NET.WORKS, Inc. (“**VIA**”) and Matt S. Nydell (the “**Executive**”).  Capitalized terms used but not defined hereinshall have the meanings given to them in the Employment Agreement (as definedbelow).

 

WHEREAS, pursuantto that certain Employment Agreement dated April 22, 2002  between VIA and the Executive (the “**Employment Agreement**”), the Executive is employed by VIA asthe Senior Vice President, General Counsel and Secretary of VIA;

 

WHEREAS, pursuantto the Employment Agreement, the Executive is entitled to a severance paymentupon termination in certain circumstances, including termination by theExecutive with or without Good Reason; and

 

WHEREAS, VIA andthe Executive agree that is in each of their best interests to amend theEmployment Agreement to eliminate VIA’s obligations to pay severance toExecutive upon termination of his employment with VIA in exchange for thepayment, mutual releases and other consideration set forth herein;

 

**NOW, THEREFORE, in considerationof the premises set forth above and the promises contained herein, VIA and theExecutive hereby agree as follows:**

 

1.             Modification of Employment Agreement.  Effective as of the date hereof, Sections5(a), 5(b), 5(c) and 5(e) of the Employment Agreement shall be of nofurther force and effect.

 

2.             Payment.  In exchange for the modification described inSection 1 and the releases contained herein, VIA shall pay an aggregate ofUS$245,000 (of which $225,000 represents one year of base salary and $20,000represents one year of health, dental, life, accidental death and disabilityinsurance) to Executive by wire transfer upon execution of this agreement (the “**Payment**”).  Thisamount shall be fully earned as of the date of the Payment, and no portionshall be refunded if the Executive’s employment terminates prior to May 31,2005 or at any other time.

 

3.             Release by Executive.  The Executive, on behalf of himself and hisheirs, executors, administrators, successors, attorneys and assigns, herebyreleases and discharges VIA and any and all of its current or formeraffiliates, members, officers, directors, employees, agents, trustees,successors and assigns (collectively, the **“VIAReleased Parties”**), from any and all claims Executive may havethrough the date hereof under the Employment Agreement, including withoutlimitation claims based on Sections 5(a), 5(b), 5(c) and 5(e) of theEmployment Agreement and claims for any consequential or punitive damages.  This release includes a release of any rightsor claims Executive may have related to the Employment Agreement under any U.S.federal or state, United Kingdom or other law, including any law relating tosecurities, employment, employee

 

----

 

benefits, employee benefit plans, insurance, ordiscrimination on account of race, color, religion, sex, national origin, age,disability or other illegal basis, or based on contract or tort.  This release covers both claims Executiveknows about and those he may not know about, including any claims or rightsExecutive may have that arise after Executive executes this Agreement.  Executive covenants and agrees that he willnot file any claim or lawsuit asserting these claims in any court or othertribunal and that he will indemnify and hold harmless the VIA Released Partiesagainst any and all costs and expenses (including reasonable attorneys fees)incurred in connection with their defense of any such claim or lawsuit that isfiled in violation of this paragraph. Via and the Executive agree that nothing contained in this Agreementshall constitute or be treated as an admission of liability or wrongdoing byany of the VIA Released Parties. Executive agrees and acknowledges that he will not be entitled to anyseverance or similar payments from VIA pursuant to the terms of the EmploymentAgreement or otherwise, other than as provided in Section 5(d) of theEmployment Agreement with respect to the treatment of stock options previouslygranted to Executive.

 

4.             Release by VIA.  VIA, on behalf of itself and all of itscurrent or former affiliates, members, officers, directors, employees, agents,trustees, successors and assigns hereby releases and discharges Executive andhis heirs, executors, administrators, successors, attorneys and assigns any and(collectively, the **“Executive ReleasedParties”**), from any and all claims VIA may have through the datehereof under the Employment Agreement, including without limitation claims forany consequential or punitive damages. This release includes a release of any rights or claims VIA may haverelated to the Employment Agreement under any U.S. federal or state, UnitedKingdom or other law, including any law relating to securities, employment,employee benefits, employee benefit plans, insurance, or discrimination onaccount of race, color, religion, sex, national origin, age, disability orother illegal basis, or based on contract or tort.  This release covers both claims VIA’sofficers, directors or employees know about and those they may not know about,including any claims or rights VIA may have that arise after VIA executes thisAgreement.  VIA covenants and agrees thatit will not file any claim or lawsuit asserting these claims in any court orother tribunal and that it will indemnify and hold harmless the ExecutiveReleased Parties against any and all costs and expenses (including reasonableattorneys fees) incurred in connection with their defense of any such claim orlawsuit that is filed in violation of this paragraph.  VIA and the Executive agree that nothingcontained in this Agreement shall constitute or be treated as an admission ofliability or wrongdoing by any of the Executive Released Parties.

 

5.             Entire Agreement.  This Agreement contains the entire agreementbetween VIA and the Executive relating to matters set forth herein andsupersedes any other prior oral or written understandings or agreementsrelating thereto.  This Agreement cannotbe changed except by a writing signed by both parties hereto.  This Agreement shall be governed by, andconstrued in accordance with, the laws of the Commonwealth of Virginia(excluding the choice of law rules thereof).

 

6.             Further Acknowledgement.  Executive acknowledges that he understands thathe has the right to, and has had an opportunity to, consult with an attorneybefore executing this Agreement, that he has read and understands theAgreement, and that he is signing it voluntarily and without coercion.  Executive understands that the amount payableto him hereunder will constitute taxable income and will be subject toapplicable withholding and employment taxes to the extent required by law.

 

----

 

7.             Waiver; Severability.  Failure to insist upon strict compliance withany term, covenant or condition of this Agreement shall not be deemed a waiverof such term, covenant or condition, nor shall any waiver or relinquishment ofany right or power under this Agreement at any time or times be deemed a waiveror relinquishment of such right or power at any other time or times.  Invalidity or unenforceability of anyprovision of this Agreement shall in no way affect the validity orenforceability of any other provision.

 

8.             Counterparts.  This Agreement may be executed in multiplecounterparts, each of which shall be deemed an original but all of whichtogether shall constitute one and the same instrument.

 

9.             Representation of the Parties.  Each of VIA and the Executive represents tothe other that it is receiving consideration and benefit which is equal to orin excess of any and all liabilities or obligations it is incurring inconnection with or arising from this Agreement.

 

IN WITNESSWHEREOF, Executive and VIA have caused this Agreement to be executed as of thedate first above written.

 
|   | **VIA NET.WORKS,  INC.**        |
|--------|---------------------------------|
|   |                            |
|   | By:                             |   |   |
|   | Name: Raymond Walsh             |
|   | Title: Chief Executive  Officer |
|   |                            |
|   | **EXECUTIVE**                   |
|   |                            |
|   |                            |   |
|   | Matt  S. Nydell                 |

 

----