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                             EMPLOYMENT AGREEMENT         THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into as of April 10,  2019 (the "Effective Date"), by and between Bandwidth Inc. ("Bandwidth"), a Delaware corporation with  its principal place of business at 900 Main Campus Drive, Suite 100, Raleigh, North Carolina 27606, and  Jeffrey A. Hoffman ("Hoffman").                                      BACKGROUND         A.    Hoffman is Bandwidth's Chief Financial Officer.         B.    Hoffman has been continuously employed by Bandwidth since November 1, 2011,  pursuant to an offer letter, dated as of September 16, 2011 (the “Offer Letter”); Bandwidth and Hoffman  now desire to enter into this Agreement in order to terminate the Offer Letter and formalize the terms and  conditions of employment pursuant to this Agreement.         C.    All initially capitalized terms are either defined herein (but not necessarily where first used)  or are defined in Exhibit A attached hereto and incorporated herein by this reference.                                      AGREEMENT         In consideration of the foregoing, the agreements made herein, and for other good and valuable  consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:         1     Employment Period.   Bandwidth agrees to employ Hoffman and Hoffman agrees to  serve Bandwidth for the period beginning on the Effective Date and ending at 11:59 p.m., Raleigh, North  Carolina, local time, until December 31, 2019 (as may be extended, the "Employment Period").   The  Employment Period will automatically extend for consecutive additional one (1) year periods unless either  party provides the other with written notice to the contrary no less than sixty (60) days prior to the expiration  of the then current Employment Period.   If notice of non-extension is provided by Bandwidth, this  Agreement and Hoffman’s employment shall terminate at the end of the then current Employment Period,  and such termination of employment shall be treated as a termination by Bandwidth other than for Cause.   This Agreement may be terminated before the expiration of the Employment Period only pursuant to  Section 4.   Bandwidth and Hoffman each acknowledges and agrees that this Agreement does not interrupt  the continuity of Hoffman's employment.        2      Nature of Duties.         2.1   Hoffman will serve as Bandwidth's Chief Financial Officer.   As such, Hoffman will act  in conformity with the management policies, guidelines and directions issued by Bandwidth's Chief  Executive Officer (the "Chief Executive Officer"), and will have general charge and supervision of those  functions and such other responsibilities as the Chief Executive Officer determines and assigns; provided  they are not inconsistent with the functions and duties typically performed by, and the responsibility of,  Chief Financial Officers of like corporations.   Hoffman will report to the Chief Executive Officer.                                          Page 1 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






       2.2   Hoffman will work exclusively for Bandwidth on a full-time basis, with his primary office  at Bandwidth’s headquarters.   During normal business hours Hoffman will devote substantially all of his  business time and attention to Bandwidth's business. The foregoing does not prohibit Hoffman from  engaging in civic, professional and business activities that do not interfere with his duties to Bandwidth,  and that otherwise do not violate this Agreement.         2.3   Hoffman will perform his duties and responsibilities hereunder diligently, faithfully and  loyally.         3     Compensation and Benefits.         3.1   Base Salary and Expenses.         3.1.1 During the Employment Period, Bandwidth will pay to Hoffman a salary at the initial rate  of Three Hundred Sixty-four Thousand Eight Hundred Dollars ($364,800.00) per annum (the "Base  Salary").   The Base Salary will be earned and paid in arrears, in equal installments, semi-monthly, or at  such other interval as the Bandwidth’s Board of Directors (the “Board”) or Compensation Committee of  the Board (the “Compensation Committee”) directs, but no less often than once each month.   At the  beginning of each year during the Employment Period, the Chief Executive Officer will in good faith review  the Base Salary and recommend to the Board and/or Compensation Committee any changes for  determination by the Board and/or the Compensation Committee.   Bandwidth shall be entitled to withhold,  or cause to be withheld, any amount of federal, state, city or other withholding taxes or other amounts either  required by law or authorized by Hoffman with respect to payments made to Hoffman in connection with  his employment hereunder.        3.1.2  Bandwidth will reimburse Hoffman for all reasonable out-of-pocket business expenses  incurred by Hoffman on Bandwidth's behalf during the Employment Period, so long as such expenses are  reimbursable under Bandwidth’s policies in effect from time to time.   At Hoffman's request, expenses will  be advanced before an expenditure is incurred, or they will be paid by Bandwidth directly to third parties  from which goods or services are being obtained.        3.2    Bonus Compensation.         3.2.1 In addition to the Base Salary, Bandwidth will pay to Hoffman bonus compensation each  year during the Employment Period of up to sixty-five percent (65%) of the Base Salary (or more if  Bandwidth exceeds its CPaaS Revenue, Revenue, non-GAAP net (loss) income, and free cash flow targets  (or any other applicable corporate objectives established from time to time pursuant to Section 3.2.2 below)  and the pro-rata calculations provided in Section 3.2.2 below yield more than sixty-five percent (65%) of  the Base Salary) (the "Bonus Compensation").   The Bonus Compensation will be adjusted based on  Hoffman’s individual achievement of personal objectives established from time to time pursuant to Section  3.2.2 below; for example, if Bandwidth achieves one hundred percent (100%) of each of the CPaaS  Revenue, Revenue, non-GAAP net (loss) income, and free cash flow targets (or any other applicable  corporate objectives established from time to time pursuant to Section 3.2.2 below) and Hoffman achieves                                         Page 2 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






one hundred one percent (101%) of Hoffman’s personal objectives, the Bonus Compensation calculated  pursuant to the first sentence of this Section 3.2.1 would be multiplied by 1.01.   The individual  performance objectives and the relative weighting of the respective CPaaS Revenue, Revenue, non-GAAP  net (loss) income, and free cash flow targets (or any other applicable corporate objectives established from  time to time pursuant to Section 3.2.2 below) will be reviewed by the Chief Executive Officer, who will  make recommendations to the Board and/or the Compensation Committee for determination by the Board  and/or the Compensation Committee at the beginning of each calendar year.         3.2.2  The Bonus Compensation will be earned, if at all, upon satisfaction of criteria, reviewed  by the Chief Executive Officer, who will make recommendations to the Board and/or the Compensation  Committee for determination by the Board and/or the Compensation Committee, based on Hoffman’s  individual performance objectives and Bandwidth’s corporate objectives.   The Bonus Compensation  based on Hoffman’s individual performance objectives will be earned pro-rata upon Hoffman attaining  each objective, as reasonably reviewed by the Chief Executive Officer, who will make recommendations  to the Board and/or the Compensation Committee for determination by the Board and/or the Compensation  Committee. The Bonus Compensation based on Bandwidth’s corporate objectives will be earned upon  Bandwidth meeting its CPaaS Revenue, Revenue, non-GAAP net (loss) income, and free cash flow (or any  other applicable corporate objectives established from time to time pursuant to this Section 3.2.2) provided  for in its annual Budget pro-rata based upon the relative weighting of the respective CPaaS Revenue,  Revenue, non-GAAP net (loss) income, and free cash flow targets (or any other applicable corporate  objectives established from time to time pursuant to this Section 3.2.2), each as reasonably reviewed by the  Chief Executive Officer, who will make recommendations to the Board and/or the Compensation  Committee for determination by the Board and/or the Compensation Committee   not later than March 31st  for each calendar year.   The Chief Executive Officer may review and recommend for determination by  the Board and/or the Compensation Committee other corporate objectives and corresponding Budget targets  on an annual basis.         3.2.3 Bonus Compensation will be paid no later than March 15th of the year succeeding the  calendar year with respect to which the Bonus Compensation, if any, is calculated.          3.2.4 In addition to the Bonus Compensation, the Chief Executive Officer will from time to time  review Hoffman’s efforts on behalf of Bandwidth and may make recommendations to the Board and/or the  Compensation Committee for determination by the Board and/or the Compensation Committee a special  bonus for extraordinary service. Special bonuses, if any, will not count as any other compensation payable  under this Agreement.         3.3   Stock Options and Restricted Stock.         3.3.1 All of Hoffman's then outstanding unvested Bandwidth stock options and Bandwidth  restricted stock will immediately vest, and the options will be exercisable for the remainder of their full  original term at grant without regard to any provision in the plan under which such securities were granted  that may otherwise reduce the term, upon the earlier of:         3.3.1.1      Hoffman's death prior to termination or expiration of this Agreement; or                                        Page 3 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






       3.3.1.2      Change in Control.         3.3.2 This Section 3.3 is intended to be an award agreement itself, and is intended to supplement  the terms and conditions of any and all other award agreements between Bandwidth and Hoffman relating  to any options or restricted stock granted to Hoffman by Bandwidth, and the terms of this Section 3.3 will  govern the terms of such other award agreements in the event of any conflicts, regardless of whether such  other agreements are heretofore or have previously been entered into by the parties.         3.4   Severance.   If Bandwidth terminates Hoffman other than for Cause, or Hoffman resigns  for Good Reason, then Bandwidth will pay to Hoffman an amount ("Severance") equal to (i) one hundred  percent (100%) the prior year's Base Salary, plus (ii) one hundred percent (100%) of the Bonus  Compensation, determined as if Hoffman and Bandwidth will have achieved one hundred percent (100%)  of the objectives or targets described in Section 3.2.1 above.   Such amount, less any applicable taxes and  other similar amounts, will be paid in equal installments over a twelve (12) month period following the  termination in accordance with Bandwidth’s standard payroll practices and procedures. After an  Unapproved Change in Control, in addition to the foregoing events, Severance will also be payable if  Hoffman terminates his employment for any reason no more than twelve (12) months after the Unapproved  Change in Control.   The receipt of any severance benefits provided for pursuant to this Agreement or  otherwise will be dependent upon Hoffman’s delivery to Bandwidth of an effective general release of claims  in a form reasonably satisfactory to Bandwidth not later than thirty (30) days after the date of Hoffman’s  termination of employment (or such longer period as may be required by applicable law), and shall be paid  or commence no later than thirty (30) days thereafter, with the first payment to include any amounts that  would have been payable on payroll dates occurring after Hoffman’s termination of employment and prior  to such first payment.        3.5    Vacation.   During the Employment Period, Hoffman will be entitled to take vacation time  in accordance with Bandwidth's policies, but no less than twenty-five (25) days of paid vacation per year.   Bandwidth and Hoffman will reasonably agree on when vacation time can be taken, and how many weeks  can be taken consecutively. In the event that all or any part of the vacation is not taken for any reason during  any year, there will be no compensation paid in lieu thereof, and accrued and unused vacation time will not  be carried over and added to the vacation time for the succeeding year in accordance with such policy,  unless otherwise approved by the Chief Executive Officer.        3.6    Health, Disability, Retirement, Death and Insurance Benefits.           3.6.1 Bandwidth will provide Hoffman with the same health, disability, retirement, death and  other fringe benefits as are generally provided to the executive employees of Bandwidth in accordance with  such terms, conditions and eligibility requirements as may from time to time be established or modified by  Bandwidth; provided, that Bandwidth will pay the entire premium for family coverage under Bandwidth's  group health insurance plan unless Bandwidth reasonably determines that paying the entire premium would  be discriminatory and could subject Hoffman to adverse income tax consequences. Bandwidth shall, to the  extent allowable by law, regulation, contract and policy, continue to pay Hoffman's basic medical insurance                                          Page 4 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






premiums for twelve (12) months following a termination of Hoffman by Bandwidth other than for Cause,  whether or not this coverage is required to be available under COBRA.        3.6.2  Upon a termination of Hoffman by Bandwidth other than for Cause, Bandwidth will also  pay Hoffman a lump sum amount equal to twelve (12) months of premiums for the term life insurance  coverage Bandwidth had in effect for Hoffman as of the date of his termination of employment.   Such  amount will be payable, less applicable withholdings, with the first payment of Severance.   Hoffman will  have all rights to convert or purchase such life insurance policies as provided under the terms of the plan  and policies.         3.7    Indemnification.   During the Employment Period and after Hoffman’s termination of  employment, Bandwidth shall indemnify Hoffman and hold Hoffman harmless from and against any claim,  loss or cause of action arising from or out of Hoffman’s performance as an officer, director or employee of  Bandwidth or any of its subsidiaries or other affiliates or in any other capacity, including any fiduciary  capacity, in which Hoffman serves at Bandwidth’s request, in each case to the maximum extent permitted  by law and under Bandwidth’s Certificate of Incorporation and By-Laws.   This indemnification right is in  addition to any similar rights under any statute, Bandwidth’s Certificate of Incorporation, By-Laws and  under any other applicable agreements that now exist or may exist from time to time. During the  Employment Period and for at least 3 years following Hoffman’s termination of employment, Hoffman  shall be covered by any policy of directors and officers’ liability insurance maintained by Bandwidth for  the benefit of its officers and directors.        4      Termination.         4.1   Hoffman's employment with Bandwidth will terminate automatically upon Hoffman's  death.          4.2   Bandwidth may terminate Hoffman’s employment at any time.           4.3   If at any time during the Employment Period Bandwidth (i) assigns Hoffman to serve in a  capacity other than as Bandwidth's Chief Financial Officer or assigns Hoffman to perform tasks inconsistent  with such position, in each case, which results in a material diminution in Hoffman’s authority, duties or  responsibilities, or (ii) Bandwidth materially breaches any provision of this Agreement, then Hoffman may  resign his employment by providing notice to Bandwidth within thirty (30) days of such event of the reasons  for his resignation under this provision.   Bandwidth shall have thirty (30) days following receipt of such  notice to remedy and cure the alleged diminution or breach.   If Bandwidth does not cure such breach,  Hoffman shall resign his employment and such resignation will be deemed to be a termination by  Bandwidth other than for Cause and/or a resignation by Hoffman for "Good Reason."   Hoffman can resign  at any time other than for Good Reason.         4.4   Bandwidth will have the right to terminate Hoffman at any time, immediately, for Cause.   "Cause" will mean: (i) Hoffman is convicted of any felony (or Hoffman pleads guilty or nolo contendere  thereto); (ii) Hoffman fails or refuses to perform, in any material respect, the written policies or directives  of the Chief Executive Officer, unless such failure is corrected within thirty (30) days following his receipt                                         Page 5 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






of written notice of such failure from Bandwidth that specifically identifies the manner in which the Chief  Executive Officer believes Hoffman has substantially failed to materially perform his duties; (iii) Hoffman  materially breaches this Agreement or any other agreement between Bandwidth and Hoffman, including,  without limitation, any applicable nondisclosure agreement, unless such failure is corrected within thirty  (30) days following his receipt of written notice of such failure from Bandwidth that specifically identifies  the manner in which the Chief Executive Officer believes Hoffman has breached the agreement; or (iv) the  gross or willful misconduct by Hoffman with regard to Bandwidth or any employee of Bandwidth that is  materially injurious to Bandwidth or such employee.        5      Effects of Termination.         5.1   Upon Hoffman’s termination of employment for any reason (including death), he will be  entitled to receive (in addition to any compensation and benefits he is entitled to receive under Section 3  above, if applicable): (i) any earned but unpaid Base Salary, (ii) any earned but unpaid Bonus  Compensation, (iii) unreimbursed business expenses in accordance with Bandwidth’s policies for which  expenses Hoffman has provided appropriate documentation, (iv) a lump sum cash amount equal to the value  of his unused vacation days in accordance with the standard written policy of Bandwidth, and (v) any vested  amounts or benefits to which Hoffman is then entitled under the terms of the benefit plans then sponsored  by Bandwidth in accordance with their terms. All of Bandwidth's other obligations under this Agreement  will end immediately upon Hoffman’s termination of employment.         5.2    Any controversy or claim arising out of or relating to the benefits and entitlements of  Hoffman following a Change of Control will be resolved by binding arbitration in Raleigh, North Carolina  with the American Arbitration Association, pursuant to their commercial arbitration rules then in effect.   The determination of the arbitrator will be conclusive and binding on Bandwidth and Hoffman, and  judgment may be entered on the arbitrator's award in any court of competent jurisdiction.   The prevailing  party may recover its attorneys’ fees and expenses incurred in such dispute, including the cost of the  Arbitration if the prevailing party initiated the action.         6      Stockholder Vote.   Anything in this Agreement to the contrary notwithstanding, in the  event that any amounts payable to Hoffman hereunder, alone or together with other payments that Hoffman  has a right to receive from Bandwidth, would constitute an "excess parachute payment" (as defined in  Section 280G of the Internal Revenue Code of 1986, as amended (the "Code")), then Bandwidth will reduce  the amounts payable to the minimum extent necessary to avoid the payment of any excess parachute  payments and to avoid Hoffman being subject to the excise tax imposed by Section 4999 of the Code. In  the event that any payment or benefit intended to be provided hereunder is required to be reduced pursuant  to this Section, then the reduction shall occur in the following order: (a) reduction of cash payments  described in Section 3 (with such reduction being applied to the payments in the reverse order in which  they would otherwise be made, that is, later payments shall be reduced before earlier payments);  (b) cancellation of acceleration of vesting on any equity awards for which the exercise price exceeds the  then fair market value of the underlying equity; and (c) cancellation of acceleration of vesting of equity  awards not covered under (b) above. In the event that acceleration of vesting of equity awards is to be  cancelled, such acceleration of vesting shall be cancelled in the reverse order of the date of grant of such  equity awards, that is, later equity awards shall be canceled before earlier equity awards. Without limiting                                         Page 6 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






the foregoing, if Bandwidth is not then a public company, it will use its best efforts to secure the approval  of its stockholders to exempt the excess parachute payments from the loss of corporate tax deductions  imposed under Section 280G and the excise tax imposed under Section 4999. If Bandwidth becomes  publicly traded, it will comply with Section 951 of the Dodd-Frank Wall Street Reform and Consumer  Protection Act that requires public companies subject to the federal proxy rules to provide their shareholders  with an advisory vote on: executive compensation; the desired frequency of say-on-pay votes; and on  golden parachute arrangements, and will seek shareholder votes under Internal Revenue Code Section  162(m), and any other law, regulation or rule that requires a shareholder vote on this Agreement, or that  permits a vote to preserve tax benefits or avoid tax penalties.         7      Covenant Not To Compete.         7.1   Inducement.   This covenant between Hoffman and Bandwidth is being executed and  delivered by Hoffman in consideration of Hoffman's employment with Bandwidth and each party's rights  and obligations agreed to hereunder (including, without limitation, the Base Salary, Bonus Compensation,  and other benefits and payments set forth herein).   Hoffman acknowledges that Bandwidth's business and  Hoffman's responsibilities are international in scope.   Hoffman further acknowledges that the covenant  not to compete with Bandwidth contained in this Section 7 was and has been a condition of his employment  since Hoffman was originally employed by Bandwidth.        7.2    Restricted Activities ─ Duration.   Except as otherwise consented to or approved by the  Chief Executive Officer in writing, Hoffman agrees that during the term of this Agreement and for twelve  (12) months after Hoffman's employment with Bandwidth ends;, regardless of the time, manner or reasons  for termination, and regardless of whether terminated by Hoffman or Bandwidth, but only so long as  Bandwidth does not breach its obligations in this Agreement, Hoffman will not, directly or indirectly, acting  alone or as a member of a partnership or as an owner, director, officer, employee, manager, representative  or consultant of any corporation or other business entity:               7.2.1  engage in any business in competition with the business that is conducted by         Bandwidth in the United States, Canada or any European, Asian, Pacific or other foreign country         in which Bandwidth then or thereafter transacts business or is making a bona fide attempt to do so;               7.2.2  induce, request or attempt to influence any customers or suppliers of Bandwidth to         curtail or cancel their business or prospective business with Bandwidth or in any way interfere with         Bandwidth's business relationships; or               7.2.3  induce, solicit, assist or facilitate the inducement or solicitation by a third person         of any employee, officer, agent or representative of Bandwidth, to terminate their respective         relationship with Bandwidth or in any way interfere with Bandwidth's employee, officer, agent or         representative relationships.         7.3   Tolling; Relief of Obligations.   In the event that Hoffman breaches any provision of this  Section 7, that violation will toll the running of the restricted period set forth in Section 7.2 from the date  of commencement of such violation until such violation ceases.                                        Page 7 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






       7.4   "Blue Penciling" or Modification.   If the length of time, geographic area or scope of  restricted business activity set forth in Section 7.2 is deemed unreasonably restrictive or unreasonable in  any other respect in any court proceeding, Hoffman and Bandwidth agree and consent to such court's  modifying or reducing such restriction(s) to the extent deemed reasonable under the circumstances then  presented.        7.5    Definitions.   As used in this Section 7, the following terms will have the following  definitions:               (i)    The terms “compete” or “in competition,” as used herein, will be deemed to  include, without limitation, becoming or being an employee, owner, partner, consultant, agent, stockholder,  director, or officer of any person, partnership, firm, corporation or other entity (other than Bandwidth)  which engages in (i) the business of developing, providing, offering and selling (A) retail VoIP services,  including, without limitation, IP based unified communications services and trunking services; wholesale  VoIP services; (C) wholesale origination, termination or SMS services; (D) emergency solutions for  telecommunications carriers, including, without limitation, end-to-end call control and support, real-time  address validation, automated provisioning and/or geospatial routing; (E) communication platform as a  service (or CPaaS) solutions, including, without limitation, application program interfaces deploying, causing  the use of, or using origination, termination, or SMS services; and/or (F) product(s) or service(s) to which  any of clauses (A) through (E) apply and/or any product(s) or service(s) that perform substantially similar  functions to which any of clauses (A) through (E) apply, or (ii) any other business conducted by Bandwidth  immediately prior to such termination (or in which Bandwidth shall at such time be actively preparing to  engage).   Notwithstanding the foregoing, ownership of five (5%) percent or less of any class of securities  of an entity will not constitute competition with Bandwidth.               (ii)   The phrases “engage in a business” or “engage in a line of business” and similar  phrases will be deemed to include marketing or otherwise selling products or researching, writing,  developing, designing, distributing, testing or manufacturing products or services or otherwise preparing to  market or sell products or services.        8      Nondisclosure of Confidential Information.         8.1   Hoffman acknowledges that the discharge of his duties under this Agreement will  necessarily involve his access to Confidential Information. Hoffman acknowledges that the unauthorized  use by him or disclosure by him of such Confidential Information to third parties might cause irreparable  damage to Bandwidth and Bandwidth's business. Accordingly, Hoffman agrees that at all times after the  date hereof he will not copy, publish, disclose, divulge to or discuss with any third party nor use for his  own benefit or that of others, without the prior express written consent of the Chief Executive Officer,  except in the normal conduct of his duties under this Agreement, any Confidential Information, it being  understood and acknowledged by Hoffman that all Confidential Information created, compiled or obtained  by Hoffman or Bandwidth, or furnished to Hoffman by any person while Hoffman is associated with  Bandwidth remains its exclusive property.                                         Page 8 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






       8.2   Promptly upon termination of his employment, irrespective of the time or manner thereof  or reason therefor, and whether such termination is by Bandwidth or Hoffman, Hoffman agrees to return  and surrender to Bandwidth all tangible Confidential Information in any manner in his control or  possession, as well as all other Bandwidth property.         8.3   Pursuant to the Defend Trade Secrets Act of 2016, Hoffman understands that:                 An individual may not be held criminally or civilly liable under any federal or state trade secret law  for the disclosure of a trade secret that: (a) is made (i) in confidence to a federal, state, or local government  official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or  investigating a suspected violation of law; or (b) is made in a complaint or other document that is filed  under seal in a lawsuit or other proceeding.                 Further, an individual who files a lawsuit for retaliation by an employer for reporting a suspected  violation of law may disclose the employer's trade secrets to the attorney and use the trade secret  information in the court proceeding if the individual: (a) files any document containing the trade secret  under seal; and (b) does not disclose the trade secret, except pursuant to court order.         9     Remedies Inadequate.         9.1   Hoffman acknowledges that the services to be rendered by him to Bandwidth as  contemplated by this Agreement are special, unique and of extraordinary character. Hoffman expressly  agrees and understand that the remedy at law for any breach by him of Section 7 or 8 of this Agreement  will be inadequate and that the damages flowing from such breach are not readily susceptible to being  measured in monetary terms.   Accordingly, upon adequate proof of Hoffman's violation of any legally  enforceable provision of Section 7 or 8, Bandwidth will be entitled to immediate injunctive relief, including,  without limitation, a temporary order restraining any threatened or further breach.   In the event any  equitable proceedings are brought to enforce the provisions of any of Section 7, 8 or 9, Hoffman agrees that  he will not raise in such proceedings any defense that there is an adequate remedy at law, and Hoffman  hereby waives any such defense.   Nothing in this Agreement will be deemed to limit Bandwidth's remedies  at law or in equity for any breach by Hoffman of any of the provisions of Section 7 or 8 which may be  pursued or availed of by Bandwidth. Without limiting the generality of the immediately preceding sentence,  any covenant on Hoffman's part contained in Section 7 or 8, which may not be specifically enforceable will  nevertheless, if breached, give rise to a cause of action for monetary damages.         9.2   Hoffman has carefully considered, and has had adequate time and opportunity to consult  with his own counsel or other advisors regarding the nature and extent of the restrictions upon him and the  rights and remedies conferred upon Bandwidth under Sections 7, 8 and 9, and hereby acknowledges and  agrees that such restrictions are reasonable in time, territory and scope, are designed to eliminate  competition which otherwise would be unfair to Bandwidth, do not stifle the inherent skill and experience  of Hoffman, would not operate as a bar to Hoffman's sole means of support, are fully required to protect  the legitimate interests of Bandwidth and do not confer a benefit upon Bandwidth disproportionate to the  detriment to Hoffman.                                         Page 9 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






       9.3   The covenants and agreements made by Hoffman in Sections 7, 8 and 9 will survive full  payment by Bandwidth to Hoffman of the amounts to which Hoffman is entitled under this Agreement, the  expiration of the Employment Period and this Agreement.         10    Rights.   Hoffman acknowledges and agrees that any procedure, design feature,  schematic, invention, improvement, development, discovery, know how, concept, idea or the like (whether  or not patentable, registrable under copyright or trademark laws, or otherwise protectable under similar  laws) that Hoffman may conceive of, suggest, make, invent, develop or implement, during the course of his  service pursuant to this Agreement (whether individually or jointly with any other person or persons),  relating in any way to the business of Bandwidth or to the general industry of which Bandwidth is a part,  as will all physical embodiments and manifestations thereof, and all patent rights, copyrights, trademarks  (or applications therefor) and similar protections therein (all of the foregoing referred to as "Work  Product"), will be the sole, exclusive and absolute property of Bandwidth.   All Work Product will be  deemed to be works for hire and, in addition to the Work Product being works for hire, Hoffman hereby  assigns to Bandwidth all right, title and interest in, to and under such Work Product, including without  limitation, the right to obtain such patents, copyright registrations, trademark registrations or similar  protections as Bandwidth may desire to obtain.   Hoffman will immediately disclose all Work Product to  Bandwidth and agrees, at any time, upon Bandwidth's request and without additional compensation, to  execute any documents and otherwise to cooperate with Bandwidth respecting the perfection of its right,  title and interest in, to and under such Work Product, and in any litigation or controversy in connection  therewith, all expenses incident thereto to be borne by Bandwidth.        11     Assignment of Payment Rights.   In no event will Bandwidth be obligated to make any  payment under this Agreement to any assignee or creditor of Hoffman, other than to the estate of Hoffman  after his death.   Prior to the time of payment under this Agreement, neither Hoffman nor his legal  representative will have any right by way of anticipation or otherwise to dispose of any interest under this  Agreement.        12     Bandwidth's Obligations Unfunded.   Except as to any benefits that may be required to  be funded under any benefit plan of Bandwidth pursuant to law, as provided for in this Agreement or  pursuant to other agreements and which are not for the sole benefit of Hoffman, the obligations of  Bandwidth under this Agreement are not funded and Bandwidth will not be required to set aside or deposit  in escrow any monies in advance of the due date for payment thereof to Hoffman.        13     Notices.   Any notice to be given hereunder by Bandwidth to Hoffman will be deemed to  be given if delivered to Hoffman in person, if emailed to Hoffman at his business email address or if mailed  or overnighted to Hoffman at his address last known on the records of Bandwidth, and any notice to be  given by Hoffman to Bandwidth will be directed either to Bandwidth's Chief Executive, Secretary or  General Counsel, and in any case it will be deemed to be given if delivered in person, if emailed to the  address at his business email address or if mailed or overnighted to the person at his address last known on  the records of Bandwidth, unless any party will have duly notified the other parties in writing of a change  of address.   All notices are deemed given when delivered to such address, or if otherwise actually received  by the addressee.                                        Page 10 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






       14    Section 409A.           14.1  In order to ensure compliance with Code Section 409A and the regulations and guidance  promulgated thereunder (collectively “Section 409A”), the provisions of this Section 14 shall govern in all  cases over any contrary or conflicting provision in this Agreement (other than a comparable Section 409A  provision that is expressly intended to govern over this provision by its terms).   The intent of the parties  is that payments and benefits under this Agreement comply with, or be exempt from, Section 409A and,  accordingly, to the maximum extent permitted, this Agreement shall be interpreted and administered to be  in compliance therewith. Hoffman acknowledges and agrees that Bandwidth has made no representation to  Hoffman as to the tax treatment of the compensation and benefits provided pursuant to this Agreement and  that Hoffman is solely responsible for all taxes due with respect to such compensation and benefits.        14.2   To the extent necessary to comply with Section 409A, references in this Agreement to  “termination of employment” or “terminates employment” (and similar references) shall have the same  meaning as “separation from service” under Code Section 409A(a)(2)(A)(i), and no payment subject to  Section 409A that is payable upon a termination of employment shall be paid unless and until (and not later  than applicable in compliance with Section 409A) when Hoffman incurs a “separation from service” under  Code Section 409A(a)(2)(A)(i) (a “Separation from Service”).   In addition, if Hoffman is a “specified  employee” within the meaning of Section 409A at the time of his Separation from Service, any nonqualified  deferred compensation subject to Section 409A that would otherwise have been payable on account of, and  within the first six months following, Hoffman’s Separation from Service, and not by reason of another  event under Section 409A, will become payable on the first business day after six months following the  date of Hoffman’s Separation from Service or, if earlier, the date of Hoffman’s death.        14.3   Consistent with the requirements of Section 409A, to the extent that any reimbursement or  in-kind benefit provided is taxable and subject to Section 409A, unless stated otherwise –  (i) reimbursements and in-kind benefits will be provided only during the period during which Hoffman is  employed or receiving Severance; (ii) the expenses eligible for reimbursement or the in-kind benefits  provided in any given calendar year will not affect the expenses eligible for reimbursement or the in-kind  benefits provided in any other calendar year; (iii) the reimbursement of an eligible expense must be made  no later than the last day of calendar year following the calendar year in which the expense was incurred;  and (iv) the right to reimbursements or in-kind benefits cannot be liquidated or exchanged for any other  benefit.        14.4   For purposes of Section 409A, Hoffman’s right to receive any installment payments  pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.   If a Separation from Service occurs prior to the date of an Unapproved Change in Control, each payment  of Severance and each other payment hereunder that is made within 2-1/2 months following the end of the  year that contains the date of Hoffman’s Separation from Service is intended to be exempt from Section  409A as a short-term deferral within the meaning of the final regulations under Section 409A, each such  payment that is made later than 2-1/2 months following the end of the year that contains the date of  Hoffman’s Separation from Service is intended to be exempt under the two-times exception of Treasury  Reg. § 1.409A-1(b)(9)(iii), up to the limitation on the availability of that exception specified in the  regulation, and each payment that is made after the two-times exception ceases to be available shall be                                        Page 11 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






subject to delay (if necessary) in accordance with Section 14.2 above.   Continued medical coverage is  intended to be exempt from Section 409A under the exemption for health benefits in Treas. Reg. § 1.409A- 1(b)(9)(v)(B).          14.5   In no event may Hoffman, directly or indirectly, designate the calendar year of any payment  to be made under this Agreement that is considered nonqualified deferred compensation subject to Section  409A.   In no event shall the timing of Hoffman’s execution of the general release of claims, directly or  indirectly, result in Hoffman designating the calendar year of payment of any nonqualified deferred  compensation subject to Section 409A, and if such a payment that is subject to execution of the general  release of claims could be made in more than one taxable year, payment shall be made in the later taxable  year.        15     Amendments.   This Agreement will not be modified or discharged, in whole or in part,  except by an agreement in writing signed by all parties.        16     Entire Agreement.   Except as expressly provided for herein, this Agreement constitutes  the entire agreement between the parties with respect to the subject matter hereof.   For clarity, the Offer  Letter is, effective as of the execution of this Agreement, immediately terminated and of no further force  or effect.   The parties are not relying on any other representation, express or implied, oral or written.   This  Agreement supersedes any prior employment agreement, written or oral, between Hoffman and Bandwidth;  provided, however that other non-competition, non-solicitation, confidentiality agreements, and other  restrictive covenant agreements between Hoffman and Bandwidth remain in effect and this Agreement and  such other agreements may be enforced by Bandwidth independently or simultaneously.        17     Captions; Terms.   The captions contained in this Agreement are for convenience of  reference only and do not affect the meaning of any terms or provisions hereof.   References to "termination  of employment," "termination of Hoffman," "termination of this Agreement," "termination of the  Employment Period," and any other terms of similar meaning will all be deemed equivalent. Masculine,  feminine and neuter pronouns are interchangeable as context requires.        18     Binding Effect.   The parties may not assign this Agreement and may not assign or  delegate any right or duty hereunder and any attempt to do so is void. Subject to the foregoing, the rights  and obligations of Bandwidth hereunder will inure to the benefit of, and will be binding upon, Bandwidth  and its successors and assigns, and the rights and obligations of Hoffman hereunder will inure to the benefit  of, and will be binding upon, Hoffman and his heirs, personal representatives and estate.         19     Severable Provisions.   The provisions of this Agreement are severable, and if any one or  more provisions may be determined to be illegal or otherwise unenforceable, in whole or in part, the  remaining provisions and any partially enforceable provision will be binding and enforceable to the extent  enforceable in any jurisdiction.        20     Governing Law and Venue.   This Agreement will be interpreted, construed, and  enforced in all respects in accordance with the laws of the State of North Carolina, without regard to conflict  of laws.   Other than disputes that by the terms of this Agreement are to be resolved through binding                                        Page 12 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






arbitration, any and all actions brought arising out of, or based in whole or in part upon this Agreement or  the employment relationship between Hoffman and Bandwidth, will be brought in either a federal or state  court sitting in Raleigh, North Carolina, and the parties consent to jurisdiction and venue thereof.        IN WITNESS WHEREOF, the undersigned have executed this Agreement on the day and year first  above written, effective the Effective Date.                                                 Bandwidth:                                                 BANDWIDTH INC.                                                 By _______________________                                                 Its _______________________Chief Executive Officer                                                 Hoffman:                                                 __________________________                                                Jeffrey A. Hoffman                                        Page 13 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






                                      EXHIBIT A                              EMPLOYMENT AGREEMENT                                     DEFINITIONS         "Approved Change in Control" of Bandwidth means a Change in Control of Bandwidth of a nature  that would be required to be reported in response to Item 5.01 of the Current Report on Form 8-K, as if in  effect on the Effective Date, pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as  amended (the "Exchange Act") if the transaction causing such a change will have been approved by the  affirmative vote of at least a majority of the Continuing Directors.          "Change in Control" means, and will be deemed to have occurred at such time as: (i) any "person"  (as such term is used in Section 13(d) and 14(d) of the Exchange Act) becomes the "beneficial owner" (as  defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of fifty percent (50%) or more prior  to Bandwidth's first underwritten public offering and twenty-five percent (25%) or more after, but not as a  result of, Bandwidth's first underwritten public offering, or more of the combined voting power of  Bandwidth's Voting Securities; (ii) sale of all or substantially all of the assets of Bandwidth, or any merger,  consolidation, or reorganization to which Bandwidth is a party and as the result of which Bandwidth's  stockholders prior to the transaction do not own at least fifty percent (50%) of the voting power of the  surviving entity in the election of directors; or (iii) individuals who constitute the Continuing Directors  cease for any reason to constitute at least a majority of Bandwidth's Board of Directors.   Notwithstanding  the foregoing, no event unilaterally caused by Hoffman by virtue of his stock ownership will be a Change  in Control.   Further notwithstanding the foregoing, a Change in Control shall not be deemed to occur  unless the transaction also constitutes a change in the ownership or effective control of Bandwidth or a  change in the ownership of a substantial portion of the assets of Bandwidth, each as defined in Code Section  409A(a)(2)(A)(v) and the regulations promulgated thereunder; however, a Change in Control shall be  deemed to occur if the transaction constitutes a change in the ownership or effective control of Bandwidth  or a change in the ownership of a substantial portion of the assets of Bandwidth, each as defined in Code  Section 409A(a)(2)(A)(v) and the regulations promulgated thereunder, regardless of whether it satisfies the  foregoing.         "Budget" will mean for each year, Bandwidth's management financial targets approved by the  Board of Directors for the year in question.         "Confidential Information" means all information or trade secrets of any type or description  belonging to Bandwidth that are proprietary and confidential to Bandwidth and are not publicly disclosed  or are only disclosed with restrictions.   Without limiting the generality of the foregoing, Confidential  Information includes strategic plans for carrying on business, other business plans, cost data, internal  financial information, customer lists, employee lists, vendor lists, business partner or alliance lists,  drawings, designs, schematics, flow charts, specifications, inventions, calculations, discoveries and any  letters, papers, documents or instruments disclosing or reflecting any of the foregoing, and all information  revealed to, acquired or created by Hoffman during Hoffman's employment by Bandwidth relating to any  of the foregoing.                                        Page 14 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83 





 






       "Continuing Directors" will mean and include the persons constituting Bandwidth's Board of  Directors as of the Effective Date, and any person who becomes a director of Bandwidth subsequent to the  date hereof whose election, or nomination for election by Bandwidth's stockholders, was approved by an  affirmative vote of at least a majority of the then Continuing Directors (either by a specific vote or if  Bandwidth is then subject to the proxy rules of the Exchange Act then by approval of the proxy statement  of Bandwidth in which such person is named as a nominee for director or of the inclusion of such person  in such Proxy Statement as such a nominee, in any case without objection by any member of such approving  majority of the then Continuing Directors to the nomination of such person or the naming of such person  as a director nominee).         “New Customer Revenue” means Revenue generated during any applicable fiscal year attributable  to any customer(s) for which Bandwidth did not have an effective master service agreement (or other similar  agreement) executed with such customer as of the last business day of the immediately preceding fiscal  year.         "Operating Earnings" will mean earnings before interest, taxes, depreciation and amortization and  excluding (i) capital expenditures, (ii) extraordinary gains and losses, and (iii) any bonus(es) paid or payable  pursuant to Section 3.5 and/or Section 3.6 of the agreement to which this Exhibit A is attached, unless  Bandwidth has accrued for the payment of such bonus(es) in connection with Bandwidth’s calculation of  Operating Earnings target for the purposes of Section 3.2.           “Revenue” means revenue, as determined in accordance with generally accepted accounting  principles.         "Unapproved Change in Control" of Bandwidth will mean any Change in Control of Bandwidth  that is not an Approved Change in Control.         "Voting Securities" means Bandwidth's outstanding securities ordinarily having the right to vote at  elections of directors.                                        Page 15 of 14 US2008 5641838 4                                                            Doc ID: fe40d50628a57be66d548b2b3ddc5cacb5dfcc83