Document:

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                                                                   EXHIBIT 10.10

                             EMPLOYMENT AGREEMENT

     This Agreement is made and entered into as of February 20, 2000, by and
between M. Carroll Benton ("Executive") and XCEL Management, Inc. (the
"Company").

                                    RECITALS

     A. A. Executive desires employment as an employee of the Company and the
Company desires to retain the full-time services of Executive.

     B.    The parties hereto desire to enter into this Agreement in order to
set forth the respective rights, limitations and obligations of both the Company
and Executive with respect to the employment of Executive by the Company.

     NOW, THEREFORE, in consideration of the employment of Executive by the
Company, the compensation paid to Executive, and the other mutual promises
hereinafter contained, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

     1.1. EMPLOYMENT. The Company agrees to employ Executive and Executive
hereby accepts such employment from the Company upon the terms and conditions
set forth in this Agreement for the period beginning on the date hereof and
continuing for a period of three years ("Initial Term"), unless earlier
terminated as provided in this Agreement. This Agreement shall be automatically
renewed for a one-year period ("Renewal Term"), unless this Agreement is
terminated by either party at least 30 days prior to the end of the Initial Term
(the Initial Term and any Renewal Term shall be referred to as the "Employment
Period"). The Renewal Term will continue from year-to-year unless either party
terminates the Agreement at least 30 days prior to the expiration of any Renewal
Term.

     2.   SERVICES. Executive shall serve the Company in the roles of Chief
Administrative Officer and Controller. During the Employment Period, Executive
shall devote her best efforts and all of her business time and attention to the
business and affairs of the Company. Executive shall perform her duties and
responsibilities to the best of her abilities in a diligent, trustworthy,
businesslike and efficient manner. Executive shall also perform such other
duties, and may have job responsibilities and titles modified from time to time
as may be requested by resolution of the Company, provided such duties and job
titles shall be consistent with the level of responsibility currently held by
Executive.

     3.   EXPENSES. Executive shall be entitled to reimbursement for her
ordinary and necessary business expenses incurred in the performance of her
duties under this Agreement, including office, travel and business development
expenses, if supported by reasonable documentation as required by the Company in
accordance with its usual practices.
<PAGE>

     4.   COMPENSATION.

          a.a. Salary. During the Employment Period, the Company will pay
     Executive the compensation set forth in Exhibit 1 hereto. Executive's
                                             ---------
     compensation shall be reviewed annually by the Board of Directors and/or
     their designees. Executive's compensation may not be reduced during the
     Employment Period without the written consent of the Executive.

          b.b. Benefits and Vacation. During the Employment Period, Executive
     shall be entitled to the Benefits (including health insurance) as set forth
     on Exhibit 1 hereto.
        ---------

          c.   Stock Options. During the Employment Period, Employee shall be
     eligible for stock options as set forth on Exhibit 2 hereto and the
                                                ---------
     accompanying Stock Option Agreement.

     5.   TERMINATION. Executive's employment with the Company will continue
throughout the Employment Period unless earlier terminated pursuant to Section 1
of this Agreement or pursuant to any of the following provisions:

          a.   Termination by the Company for Cause. The Company shall have the
     right to immediately terminate Executive's employment at any time for
     "Cause" by giving Executive written notice of the effective date of
     termination (which effective date may be the date of such notice). For
     purposes of this Agreement, Cause includes:

               (i)   any act by Executive of fraud or dishonesty, including but
                     not limited to stealing or falsification of Company
                     records, with respect to any aspect of the Company's
                     business;
               (ii)  acceptance of employment with any other employer except
                     upon written permission of the Board of Directors of the
                     Company;
               (iii) misappropriation of Company funds or of any corporate
                     opportunity;
               (iv)  conviction of Executive of a felony, or of a crime that the
                     Company, in its sole discretion, determines involves an act
                     or subject matter which may reflect negatively on the
                     Company's reputation or business (or a plea of nolo
                     contender thereto);
               (v)   substantial failure by Executive to perform hereunder after
                     60 days notice of such failure and explanation of such
                     failure of performance, which is reasonably determined by
                     the Board of Directors to be injurious to the business or
                     interests of the Company;
               (vi)  acts by Executive which constitutes a breach of any
                     fiduciary duty owed to the Company by Executive; or
<PAGE>

     If the Company terminates Executive's employment for (i) through (iv)
above, the Company shall have no further obligations hereunder from and after
the effective date of termination and shall have all other rights and remedies
available under this or any other agreement and at law or in equity, and
Executive shall be entitled to nothing else. If the Company terminates
Executive's employment for (v) or (vi) above, the Company shall provide
Executive with severance payments equal to the Executive's annual salary as of
the date of her termination. Such severance payments shall be paid within sixty
(60) days of the termination date and shall be subject to the Gross-up
provisions contained in Paragraph 6(c)(iii) and Appendix A of this Agreement.

     b.   Termination by the Company without Cause. The Company shall have the
right to terminate Executive for any reason upon sixty- (60) day's notice. If
the Company terminates the Executive for any reason other than "Cause" as
addressed above, the Company shall provide Executive with severance payments
equal to twice the Executive's annual salary as of the date of her termination.
Such severance payments shall be paid within sixty (60) days of the termination
date and shall be subject to the Gross-up provisions contained in Paragraph
6(c)(iii) and Appendix A of this Agreement. The Company shall also provide
Executive with fully paid medical benefits, of the type Executive maintained as
of the termination date, for a period of eighteen (18) months after the
termination date.

     c.   Voluntary Termination by Executive. Except as provided in Section 6,
in the event that Executive's employment with the Company is terminated by
Executive prior to the end of the Employment Period, the Company shall have no
further obligations hereunder from and after the date of such termination.

     d.   Termination Upon Death or Disability. Except as set forth in the
last sentence of this paragraph, in the event that Executive shall die or become
disabled during the Employment Period, Executive's employment hereunder shall
terminate (such termination being treated for purposes of this Agreement as if
Executive had not been terminated for "Cause" pursuant to subsection a (above)
and the Company shall pay to Executive or her estate, as applicable, any
compensation due that would otherwise have been payable through the date of
death [or the term of this Agreement if Executive becomes disabled]. For
purposes of this Agreement, Executive shall become "disabled" if he shall
become, because of illness or incapacity, unable to perform the essential
functions of her job under the Agreement with or without reasonable
accommodation for a continuous period of 90 days during the Employment Period.
if Executive shall become disabled, the Company agrees that for a period of one
year from the date Executive becomes disabled, Executive shall have the right to
return to the employ of the Company on the same terms and conditions as set
forth in this Agreement.
<PAGE>

6.   CHANGE IN CONTROL.

     a.   For purposes of the Agreement, "Change of Control" means the
                                          -----------------
occurrence of any of the following events:

     i.   any "person" or "group" as such terms are used under Sections 13(d)
          and 14(d) of the Securities Exchange Act of 1934, as amended (the
          "Exchange Act"), other than the Company, any trustee or any other
          fiduciary holding securities under an employee benefit plan of the
          Company, or any corporation owned, directly or indirectly, by the
          stockholders of the Company in substantially the same proportions as
          their ownership of Common Stock of the Company, is or becomes the
          "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
          of securities of the Company representing thirty percent (30%) or more
          of the combined voting power of Company's voting securities then-
          outstanding;

     ii.  during any period of two consecutive years, individuals who at the
          beginning of such period constituted the Board of Directors of the
          Company cease for any reason to constitute a majority thereof (unless
          the election, or nomination for election by the Company's
          stockholders, of such director was approved by a vote of at least two-
          thirds (2/3) of the directors then still in office who either were
          directors at the beginning of such period or whose election or
          nomination for election was previously so approved);

     iii. The Company completes a merger or consolidation of the Company with
          another corporation, other than (A) a merger or consolidation which
          would result in the voting securities of the Company outstanding
          immediately prior thereto continuing to represent (either by remaining
          outstanding or by being converted into voting securities of the
          surviving entity) more than eighty percent (80%) of the combined
          voting power of the voting securities of the Company or such surviving
          entity outstanding immediately after such merger or consolidation, or
          (B) a merger or consolidation affected to implement a recapitalization
          of the Company (or similar transaction) in which no "person" (as
          herein above defined) acquires more than thirty percent (30%) of the
          combined voting power of the Company's then-outstanding voting
          securities; or

     iv.  the stockholders of the Company approve a plan of complete liquidation
          of the Company or any agreement for the sale or disposition by the
          Company of all or substantially all of the Company's assets.
<PAGE>

     b.   For purposes of this Agreement, "Good Reason" means the occurrence of
                                           -----------
          any of the following events:

          i.   i.   the reduction of the Executive's job title, position or
               responsibilities without the Executive's prior written consent;

          ii.  the change of the location where the Executive is based to a
               location which is more than fifty (50) miles from her present
               location without the Executive's prior written consent; or

          iii. the reduction of the Executive's annual compensation by more than
               ten percent (10%) from the sum of the higher rate of the
               Executive's actual annual compensation in effect within two years
               immediately preceding the Change of Control.

          Executive shall give the Company fifteen (15) business days notice of
          an intent terminate this Agreement for "Good Reason" as defined in
          this Section 6, and provide the Company with ten (10) business days
          after receipt of such notice from Executive to remedy the alleged
          violation of subparagraphs 6(b)(i)(ii), or (iii).

     c.   Benefits Upon Change in Control

          i.   i.   Severance Benefits. If the Executive's employment with
                    ------------------
               Employer is terminated (i) by the Company (or by the acquiring or
               successor business entity following a Change of Control) other
               than for Cause or death, or (ii) by the Executive for Good
               Reason, in either event within a period beginning one hundred and
               eighty (180) days before, and ending two (2) years after, the
               date of a Change of Control (the "Change Period"), the Executive
               shall receive a severance benefit in an amount equal to two (2)
               times the sum of:

               (1)  (1) the Executive's highest annual cash base salary in
                    effect within two (2) years immediately preceding the Change
                    of Control; plus

               (2)  the average of the Executive's annual bonuses paid for the
                    two (2) calendar years immediately preceding the Change of
                    Control.

               In addition, for eighteen months following the date of
               termination of the Executive's employment in circumstances in
               which a severance payment is due hereunder, the Company shall
               provide the Executive health and other welfare benefits that are
               not less
<PAGE>

               favorable to the Executive than those to which he was entitled
               immediately prior to the Change in Control. Provided however, the
               Company shall have no obligation to provide Executive with any
               compensation under this Section 6 if Executive is in breach or
               violation of any of the covenants contained in Sections 7, 9, 10,
               and 12.

          ii.  Form of Payment. The amount of the severance benefit provided in
               ---------------
               Paragraph 6(c)(i) hereof shall be paid to Executive in two (2)
               equal installments, the first installment payable as soon as
               practicable after the occurrence of the event giving rise to the
               payment of the severance benefit by the Company hereunder, but in
               no event more than thirty (30) days thereafter, and the second
               installment payable one (1) year following the occurrence of such
               event, provided, however, that the severance benefit payable by
               the Company pursuant to Paragraph 6(c)(i) hereof will be reduced
               by any other cash payments made to the Executive under a written
               employment agreement between the Executive and the Company for
               periods after the date on which the Executive's employment was
               terminated.

          iii. Gross-Up Payments. Anything in this Agreement to the contrary
               -----------------
               notwithstanding, in the event that a severance payment is made
               under this Agreement and it shall be determined (as hereafter
               provided) that any payment (other than the Gross-Up Payments
               provided for herein) or distribution by the Company or any of its
               affiliates to or for the benefit of the Executive, whether paid
               or payable or distributed or distributable pursuant to the terms
               of this Agreement or otherwise pursuant to or by reason of any
               other agreement, policy, plan, program or arrangement, or the
               lapse or termination of any restriction on, or the vesting or
               exercisability of any of the foregoing (a "Payment"), excluding,
               however, any stock option or right in respect of restricted
               stock, would be subject to the excise tax imposed by Section 4999
               of the Internal Revenue Code of 1986, as amended (the "Code") (or
               any successor provision thereto), by reason of being considered
               "contingent on a change in ownership or control" of the Company,
               within the meaning of Section 280G of the Code (or any successor
               provision thereto) or to any similar tax imposed by state or
               local law, or any interest or penalties with respect to such tax
               (such tax or taxes, together with any such interest and
               penalties, being hereafter collectively referred to as the
               "Excise Tax"), then the Executive shall be entitled to receive an
               additional payment or payments (collectively, a "Gross-Up
               Payment"). The Gross-Up Payment shall be in an amount such that,
               after payment by the Executive of all taxes (including any
               interest or penalties imposed with respect
<PAGE>

               to such taxes), including an Excise Tax imposed upon the Gross-Up
               Payment, the Executive retains an amount of the Gross-Up Payment
               equal to the Excise Tax imposed upon the Payment. The procedural
               provisions relating to Gross-Up Payments that are set forth in
               Appendix A hereto are hereby incorporated herein by this
               reference.

          d.   Mitigation. The Executive shall not be required to mitigate the
               ----------
               amount of any payment provided for in this Section 6 of this
               Agreement by seeking other employment or otherwise.

     7.   NONDISCLOSURE. Executive acknowledges that during the course of her
employment by the Company, the Company will provide, and the Executive will
acquire, knowledge of special and unique value with respect to the Company's
business operations, including, by way of illustration, the Company's existing
and contemplated product line, trade secrets, compilations, business and
financial methods or practices, plans, hardware and software technology
products, systems, programs, projects and know-how, pricing, cost of providing
service and equipment, operating and maintenance costs, marketing and selling
techniques and information, customer data, customer names and addresses,
customer service requirements, supplier lists, and confidential information
relating to the Company's policies, employees, and/or business strategy (all of
such information herein referenced to as the "Confidential Information").
Executive recognizes that the business of the Company is dependent upon
Confidential Information and that the protection of the Confidential Information
against unauthorized disclosure or use is of critical importance to the Company.
Executive agrees that, without prior written authorization of the Chairman of
the Board of the Company, Executive will not, during her employment, divulge to
any person, directly or indirectly, except to the Company or its officers and
agents or as reasonably required in connection with Executive's duties on behalf
of the Company, or make any independent use of, except on behalf of the Company,
any of the Company's Confidential Information, whether acquired by the Executive
during her employment or not. Executive further agrees that Executive will not,
at any time after her employment has ended, use or divulge to any person
directly or indirectly any Confidential Information, or use any Confidential
Information in subsequent employment of any nature. If Executive is subpoenaed,
or is otherwise required by law to testify concerning Confidential Information,
Executive agrees to notify the Company upon receipt of a subpoena, or upon
belief that such testimony shall be required. This nondisclosure provision shall
survive the termination of this Agreement for any reason. Executive acknowledges
that the Company would not employ Executive but for her covenants and promises
contained in this Section 7.

     8.   RETURN OF DOCUMENTS. Executive agrees that if Executive's relationship
with the Company is terminated (for whatever reason), Executive shall not remove
or take with Executive, but will leave with the Company or return to Company,
all Confidential Information, Work Product (as defined in Section 12), records,
files, data, memoranda, reports, customer lists, customer information, product
information, price lists, documents and other information, in whatever form
(including on computer disk), and any and all copies thereof, or if such items
are not on the premises of the
<PAGE>

Company, Executive agrees to return such items immediately upon Executive's
termination or the request of the Company. Executive acknowledges that all such
items are and remain the property of the Company.

     9.   NON-INTERFERENCE OR SOLICITATION. Executive agrees that during her
employment, and for a period of six (6) months following the termination of her
employment (for whatever reason), that neither he nor any individual,
partner(s), limited partnership, corporation or other entity or business with
which he is in any way affiliated, including, without limitation, any partner,
limited partner, director, officer, shareholder, employee, or agent of any such
entity or business, will (i) request, induce or attempt to influence, directly
or indirectly, any employee of the Company to terminate their employment with
the Company or (ii) employ any person who as of the date of this Agreement was,
or after such date is or was, an employee of the Company. Executive further
agrees that during the period beginning with the commencement of Executive's
employment with the Company and ending six (6) months after the termination of
Executive's employment with the Company (for whatever reason), he shall not,
directly or indirectly, as an employee, agent, consultant, stockholder,
director, partner or in any other individual or representative capacity of the
Company or of any other person, entity or business, solicit or encourage any
present or future customer, supplier, contractor, partner or investor of the
Company to terminate or otherwise alter his, her or its relationship with the
Company. This provision shall survive the termination of this Agreement for any
reason.

     10.  NON-COMPETITION. In consideration of the numerous mutual promises
contained in the Agreement between the Company and the Executive, including,
without limitation, those involving Confidential Information, and in order to
protect the Company's Confidential Information and to reduce the likelihood of
irreparable damage which would occur in the event such information is provided
to or used by a competitor of the Company, Executive agrees that during her
employment and for an additional period of six (6) months immediately following
the termination of her employment, whether voluntary or involuntary (the "Non-
competition Term"), not to, directly or indirectly, either through any form of
ownership or as a director, officer, principal, agent, employee, employer,
adviser, consultant, shareholder, partner, or in any individual or
representative capacity whatsoever, without the prior written consent of the
Company (which consent may be withheld in its sole discretion), (i) compete for
or solicit business related to Internet Utility Services for or on behalf of any
person or business entity with a place of business in the United States or
Canada; (ii) own, operate, participate in, undertake any employment with or have
any interest in any entity with a place of business in the United States or
Canada in the business of marketing and selling of Internet Utility Services to
persons or business entities, except owning publicly traded stock for investment
purposes only in which Executive owns less than 5%, (iii) compete for or solicit
Internet Utility Services business from any customer of the Company (or its
successors by merger); or (iv) use in any competition, solicitation, or
marketing effort any Confidential Information, any proprietary list, any
information concerning customers of the Company, or any Work Product (as defined
in Section 12).
<PAGE>

     If, during any period within the Non-competition Term, Executive is not in
compliance with the terms of this Section 10, the Company shall be entitled to,
among other remedies, compliance by Executive with the terms of this Section 10
for an additional period equal to the period of such noncompliance. For purposes
of this Agreement, the term "Non-competition Term" shall also include this
additional period. Executive hereby acknowledges that the geographic boundaries,
scope of prohibited activities and the time duration of the provisions of this
Section 10 are reasonable and are no broader than are necessary to protect the
legitimate business interests of the Company.

     This non-competition provision shall survive the termination of Executive's
employment and can only be revoked or modified by a writing signed by the
parties which specifically states an intent to revoke or modify this provision.
Any writing modifying this provision may only be signed on behalf of the Company
by its General Counsel or Chairman of the Board. Executive acknowledges that the
Company would not employ her but for her covenants or promises contained in this
Section 10.

     11.  REFORMATION OF SECTION 10. The Company and Executive agree and
stipulate that the agreements and covenants not to compete contained in Section
10 hereof are fair and reasonable in light of all of the facts and circumstances
of the relationship between Executive and the Company; however, Executive and
the Company are aware that in certain circumstances courts have refused to
enforce certain agreements not to compete. Therefore, in furtherance of, and not
in derogation of the provisions of Section 10, the Company and Executive agree
that in the event a court should decline to enforce the provisions of Section
10, that Section 10 shall be deemed to be modified or reformed to restrict
Executive's competition with the Company or its affiliates to the maximum
extent, as to time, geography and business scope, which the court shall find
enforceable; provided, however, in no event shall the provisions of Section 10
be deemed to be more restrictive to Executive than those contained herein.

     12.  ACKNOWLEDGMENT OF EMPLOYER'S RIGHT IN WORK PRODUCT. For purposes of
this Section 12, "Work Product" shall mean all intellectual property rights,
including all trade secrets, U.S. and international copyrights, patentable
inventions, discoveries and other intellectual property rights in any
programming, design, documentation, technology, or other work product that is
created in connection with Executive's work. In addition, all rights in any
preexisting programming, design, documentation, technology, or other Work
Product provided to the Company during Executive's employment shall
automatically become part of the Work Product hereunder, whether or not it
arises specifically out of Executive's "Work." For purposes of this Agreement,
"Work" shall mean (1) any direct assignments and required performance by or for
the Company, and (2) any other productive output that relates to the business of
the Company and is produced during the course of Executive's employment or
engagement by the Company. For this purpose, Work may be considered present even
after normal working hours, away from the Company's premises, on an unsupervised
basis, alone or with others. Unless otherwise provided in a subsequent writing
signed by the Chairman of the Board of Directors of the Company, this Agreement
shall apply to all Work
<PAGE>

Product created in connection with all Work conducted before or after the date
of this Agreement.

     The Company shall own all rights in the Work Product. To this end, all Work
Product shall be considered work made for hire for the Company. If any of the
Work Product may not, by operation of law or agreement, be considered Work made
by Executive for hire for the Company (or if ownership of all rights therein do
not otherwise vest exclusively in the Company immediately), Executive agrees to
assign, and upon creation thereof does hereby automatically assign, with further
consideration, the ownership thereof to the Company. Executive hereby
irrevocably relinquishes for the benefit of the Company and its assigns any
moral rights in the Work Product recognized by applicable law. The Company shall
have the right to obtain and hold, in whatever name or capacity it selects,
copyrights, registrations, and any other protection available in the Work
Product.

     Executive agrees to perform upon the request of the Company, during or
after Executive's Work or employment, such further acts as may be necessary or
desirable to transfer, perfect, and defend the Company's ownership of the Work
Product, including by (1) executing, acknowledging, and delivering any requested
affidavits and documents of assignment and conveyance, (2) obtaining and/or
aiding in the enforcement of copyrights, trade secrets, and (if applicable)
patents with respect to the Work Product in any countries, and (3) providing
testimony in connection with any proceeding affecting the rights of the Company
in any Work Product.

     Executive warrants that Executive's Work for the Company does not and will
not in any way conflict with any remaining obligations Executive may have with
any prior employer or contractor. Executive also agrees to develop all Work
Product in a manner that avoids even the appearance of infringement of any third
party's intellectual property rights. This provision shall survive the
termination of this Agreement for any reason.

     13.  INJUNCTIVE RELIEF. Executive acknowledges and agrees that the
agreements and covenants contained in this Agreement are essential to protect
the Confidential Information, business, and goodwill of the Company. Executive
further acknowledges that the breach of any of the agreements contained herein,
including, without limitation, the confidentiality covenants specified in
Section 7, the non-solicitation covenants specified in Section 9, the non-
competition covenants contained in Section 10, and the covenants with respect to
Work Product contained in Section 12, will give rise to irreparable injury to
the Company, inadequately compensable in damages. Accordingly, the Company shall
be entitled to injunctive relief to prevent or cure breaches or threatened
breaches of the provisions of this Agreement and to enforce specific performance
of the terms and provisions hereof in any court of competent jurisdiction, in
addition to any other legal or equitable remedies which may be available.
Executive further acknowledges and agrees that in the event of the termination
of Executive's employment with the Company, whether voluntary or involuntary,
that the enforcement of a remedy hereunder by way of injunction shall not
prevent Executive from earning a reasonable livelihood. Executive further
acknowledges and agrees that
<PAGE>

the covenants contained herein are necessary for the protection of the Company's
legitimate business interests and are reasonable in scope and content.

     14.  SEVERABILITY AND REFORMATION. If any provision of this Agreement is
          held to be illegal, invalid or unenforceable under any present or
          future law, and if the rights or obligations of Executive or the
          Company under this Agreement would not be materially and adversely
          affected thereby, such provision shall be fully severable, and this
          Agreement shall be construed and enforced as if such illegal, invalid
          or unenforceable provision had never comprised a part thereof, the
          remaining provisions of this Agreement shall remain in full force and
          effect and shall not be affected by the illegal, invalid or
          unenforceable provision or by its severance herefrom, and in lieu of
          such illegal, invalid or unenforceable provision, there shall be added
          automatically as a part of this Agreement a legal, valid and
          enforceable provision as similar in terms to such illegal, invalid or
          unenforceable provision as may be possible, and the Company and
          Executive hereby request the court to whom disputes relating to this
          Agreement are submitted to reform the otherwise unenforceable covenant
          in accordance with this Section 14.

     15.  ARBITRATION. The Employee and the Company shall submit to mandatory
          binding arbitration in any controversy or claim arising out of, or
          relating to, this agreement or any breach hereof. Such arbitration
          shall be conducted in accordance with the commercial arbitration rules
          of the American Arbitration Association in effect at that time, and
          judgment upon the determination or ward rendered by the arbitrator may
          be entered in any court having jurisdiction thereof. The arbitrator is
          hereby authorized to award to the prevailing party the costs
          (including reasonable attorneys' fees and expense) of any such
          arbitration.

     16.  GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WiTH THE LAWS OF THE STATE OF WASHINGTON WiTHOUT GIVING EFFECT TO
ANY PRINCIPLE OF CONFLICT-OF-LAWS THAT WOULD REQUIRE THE APPLICATION OF THE LAW
OF ANY OTHER JURISDICTION.

     17.  SURVIVAL. Executive's termination from employment, for whatever
reason, shall not reduce or terminate Executive's covenants and agreements set
forth herein.

     18.  ENTIRE AGREEMENT. This Agreement, including the Recitals and
introductions, embodies the entire agreement and understanding of the parties
hereto with respect to the subject matter contained herein and supersedes any
and all prior conflicting
<PAGE>

or inconsistent agreements, consents and understandings relating to such subject
matter. Executive acknowledges and agrees that there is no oral or other
agreement between the Company and Executive which has not been incorporated in
this Agreement. This Agreement may only be modified pursuant to Section 19.

     19.  NO WAIVER. The forebearance or failure of one of the parties hereto to
insist upon strict compliance by the other with any provision of this Agreement,
whether continuing or not, shall not be construed as a waiver of any rights or
privileges hereunder. No waiver of any right or privilege of a party arising
from any default or failure hereunder of performance by the other shall affect
such party's rights or privileges in the event of a further default or failure
of performance.

     20.  MODIFICATION. This Agreement may be modified only by a written
agreement signed by both parties. Any such written modification may only be
signed on behalf of the Company by the General Counsel or Chairman of the Board
of the Company.

     21.  KNOWLEDGE. Executive acknowledges that Executive has had the
opportunity to read and review this Agreement and that Executive understands all
of the terms of this Agreement and its importance. Executive further
acknowledges that the Company would not employ or disclose Confidential
Information to Executive without this Agreement and her promises concerning
nondisclosure, non-solicitation, non-competition, and Work Product. Executive
acknowledges that the Company encourages Executive to consider consulting with
an attorney prior to execution of this Agreement by Executive.

     22.  COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original instrument, and
all of which together shall constitute one and the same Agreement.

     IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the day and year designated above.
<PAGE>

EXECUTIVE

                                             /s/ M. Carroll Benton
                                             --------------------------------

                                             XCEL MANAGEMENT, INC.

                                             By: /s/ John P. Gorst
                                                -----------------------------

                                             Name: John P. Gorst
                                                  ---------------------------
                                             Title: Chairman CEO
                                                   --------------------------

<PAGE>

                                   Exhibit 1

                              Salary and Benefits

Reference Section 4, part a.

     A.   Salary to be $135,000 per annum for year one of the Employment Period.

     B.   Salary to be $150,000 per annum for year two of the Employment Period.

     C.   Salary to be $165,000 per annum for year three of the Employment
          Period.

Reference Section 4, part b.

     A.   Executive eligible to participate in an incentive bonus program.

     B.   Executive to receive 6 weeks paid vacation each calendar year.

     C.   Executive to receive 7 days per calendar year as sick leave.

     D.   Executive to receive subsidized health, life, disability, and dental
          insurance through the Company.

     E.   Executive to receive use of a Company owned/leased vehicle.
<PAGE>

                       Exhibit 2 -- Stock Options

     During a meeting of the Company's Board of Directors on February 21, 2000
(the "Grant Date"), the Board approved the award of stock options to Executive
pursuant to the terms outlined in this Exhibit 2. The options described in this
Exhibit 2 will be documented through a stock option plan, to be adopted
effective as of the Grant Date, and two option agreements. The stock option plan
and option agreements will contain additional terms and conditions concerning
the options; provided, however, that the options issued to Executive will
terminate on the tenth (10/th/) anniversary of the Grant Date. In the case of a
conflict between this Exhibit 2 and the option agreements entered into between
the Company and Executive or the Company's stock option plan, the language of
the option agreements and/or the relevant stock option plan shall control.

     1.   Preferred Stock Option Award. The Board of Directors has awarded
          ----------------------------
Executive an option to acquire one million shares of the Company's Class A
Common Stock, with an initial exercise price of $.20, which is equal to 100% of
the fair market value of the Company's preferred stock on the Grant Date. The
option will become vested after the eighth anniversary of the Grant Date. The
Executive's ability to exercise the option will accelerate, however, based on
the Company's attainment of the following milestones:

          A.   500,000 shares will become immediately exercisable on the date
     that the Company's common stock is traded on the NASD Bulletin Board.

          B.   250,000 shares will become immediately exercisable on the date
     that $5 million in outside investment capital for the Company has been
     raised (following the date of the Company's incorporation).

          C.   250,000 shares will become immediately exercisable on the first
     business day following the date that the Company's common stock has traded
     on the NASD Bulletin Board at $5.00 per share for a period of ten (10)
     consecutive business days.

     2.   Common Stock Option Award. The Board of Directors has awarded
          -------------------------
Executive an option to acquire three million shares of the Company's common
stock, with an initial exercise price which is not less than 100% of the fair
market value of the Company's common stock on the Grant Date. The options will
become vested on the dates listed below.

          1.   750,000 options become exercisable on the one-year anniversary of
     the Grant Date. The options shall have an exercise price of $0.50 per
     share.

          2.   750,000 options become exercisable on the two-year anniversary of
     the Grant Date. The options shall have an exercise price of $1.00 per
     share.
<PAGE>

          3.   1,000,000 options become exercisable on the three-year
anniversary of the Grant Date. The options' exercise price shall be as follows:
(i) 330,000 options shall have an exercise price of $1.50 per share; (ii)
450,000 options shall have an exercise price of $3.00 per share; and (iii)
220,000 options shall have an exercise price of $4.00 per share.
<PAGE>

Appendix A
----------

GROSS-UP PAYMENT PROCEDURAL PROVISIONS

          (a)  Subject to the provision of Paragraph (e) hereof, all
determinations required to be made under Paragraph 6(c)(iii) of the Agreement,
including whether an Excise Tax is payable by the Executive and the amount of
such Excise Tax and whether a Gross-Up Payment is required to be paid by the
Company to the Executive and the amount of such Gross-Up Payment, if any, shall
be made by a Top 5 accounting firm (the "Accounting Firm") selected by the
Executive in her sole discretion. The Executive shall direct the Accounting Firm
to submit its determination and detailed supporting calculations to both the
Company and the Executive within thirty (30) calendar days after the Termination
Date, if applicable, and any such other time or times as may be requested by the
Company or the Executive. If the Accounting Firm determines that any Excise Tax
is payable by the Executive, the Company shall pay the required Gross-Up Payment
to the Executive within fifteen (15) business days after receipt of such
determination and calculations with respect to any Payment to the Executive. If
the Accounting Firm determines that no Excise Tax is payable by the Executive,
it shall, at the same time as it makes such determination, furnish the Company
and the Executive an opinion that the Executive has substantial authority not to
report any Excise Tax on her federal, state or local income or other tax return.
As a result of the uncertainty in the application of Section 4999 of the Code
(or any successor provision thereto) and the possibility of similar uncertainty
regarding applicable state or local tax law at the time of any determination by
the Accounting Firm hereunder, it is possible that Gross-Up Payments which shall
not have been made by the Company should have been made (an "Underpayment"),
consistent with the calculations required to be made hereunder. In the event
that the Company exhausts or fails to pursue its remedies pursuant to Paragraph
(e) hereof and the Executive thereafter is required to make a payment of any
Excise Tax, the Executive shall direct the Accounting Firm to determine the
amount of the Underpayment that has occurred and to submit its determination and
detailed supporting calculations to both the Company and the Executive as
promptly as possible. Any such Underpayment shall be promptly paid by the
Company to, or for the benefit of, the Executive within fifteen (15) business
days after receipt of such determination and calculations.

          (b)  The Company and the Executive shall each provide the Accounting
Firm access to and copies of any books, records and documents in the possession
of the Company or the Executive, as the case may be, reasonably requested by the
Accounting Firm, and otherwise cooperate with the Accounting Firm in connection
with the preparation and issuance of the determinations and calculations
contemplated by Paragraph (a) hereof. Any determination by the Accounting Firm
as to the amount of the Gross-Up Payment shall be binding upon the Company and
the Executive.

          (c)  The federal, state and local income or other tax returns filed by
the Executive shall be prepared and filed on a consistent basis with the
determination of the Accounting Firm with respect to the Excise Tax payable by
the Executive. The
<PAGE>

Executive shall make proper payment of the amount of any Excise Payment, and at
the request of the Company, provide to the Company true and correct copies (with
any amendments) of her federal income tax return as filed with the Internal
Revenue Service and corresponding state and local tax returns, if relevant, as
filed with the applicable taxing authority, and such other documents reasonable
requested by the Company, evidencing such payment. If prior to the filing of the
Executive's federal income tax return, or corresponding state or local tax
return, if relevant, the Accounting Firm determines that the amount of the
Gross-Up Payment should be reduced, the Executive shall within fifteen (15)
business days pay to the Company the amount of such deduction.

          (d)  The fees and expenses of the Accounting Firm for its services in
connection with the determinations and calculations contemplated by Paragraph
(a) hereof shall be borne by the Company. If such fees and expenses are
initially paid by the Executive, the Company shall reimburse the Executive the
full amount of such fees and expenses within fifteen (15) business days after
receipt from the Executive of a statement therefor and reasonable evidence of
her payment thereof.

          (e)  The Executive shall notify the Company in writing of any claim by
the Internal Revenue Service or any other taxing authority that, if successful,
would require the payment by the Executive of a Gross-Up Payment. Such
notification shall be given as promptly as practicable but no later than ten
(10) business days after the Executive actually receives notice of such claim
and the Executive shall further apprise the Company of the nature of such claim
and the date on which such claim is requested to be paid (in each case, to the
extent known by the Executive). The Executive shall not pay such claim prior to
the earlier of (i) the expiration of the thirty (30) calendar-day period
following the date on which he gives such notice to the Company and (ii) the
date that any payment of amount with respect to such claim is due. If the
Company notifies the Executive in writing prior to the expiration of such period
that it desires to contest such claim, the Executive shall:

          (i)   provide the Company with any written records or documents in her
     possession relating to such claim reasonably requested by the Company;

          (ii)  take such action in connection with contesting such claim as the
     Company shall reasonable request in writing from time to time, including
     without limitation accepting legal representation with respect to such
     claim by an attorney competent in respect of the subject matter and
     reasonably selected by the Company;

          (iii) cooperate with the Company in good faith in order effectively to
     contest such claim, and

          (iv)  permit the Company to participate in any proceedings relating to
such claim;
<PAGE>

provided, however that the Company shall bear and pay directly all costs and
-----------------
expenses (including interest and penalties) incurred in connection with such
contest and shall indemnity and hold harmless the Executive, on an after-tax
basis, for and against any Excise Tax or income tax, including interest and
penalties with respect thereto, imposed as a result of such representation and
payment of costs and expenses. Without limiting the foregoing provisions of this
Paragraph (e), the Company shall control all proceedings taken in connection
with the contest of any claim contemplated by this Paragraph (e) and, at its
sole option, may pursue or forego any and all administrative appeals,
proceedings, hearings and conferences with the taxing authority in respect of
such claim (provided, however, that the Executive may participate therein at her
own cost and expense) and may, at its option, either direct the Executive to pay
the tax claimed and sue for a refund or contest the claim in any permissible
manner, and the Employee agrees to prosecute such contest to a determination
before any administrative tribunal, in a count of initial jurisdiction and in
one or more appellate courts, as the Company shall determine; provided, however,
                                                              -----------------
that if the Company directs the Executive to pay the tax claimed and sue for a
refund, the Company shall advance the amount of such payment to the Executive on
an interest-free basis and shall indemnify and hold the Executive harmless, on
an after-tax basis, from any Excise Tax or income or other tax, including
interest or penalties with respect thereto, imposed with respect to such
advance; and provided further, however, that any extension of the statute of
             -------------------------
limitations relating to payment of taxes for the taxable year of the Executive
with respect to which the contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Company's control of any such
contested claim shall be limited to issues with respect to which a Gross-Up
Payment would be payable hereunder and the Executive shall be entitled to settle
or contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.

          (f)  If, after the receipt by the Executive of an amount advanced by
the Company pursuant to Paragraph (e) hereof, the Executive receives any refund
with respect to such claim, the Executive shall (subject to the Company's
complying with the requirements of Paragraph (e) hereof) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after any taxes applicable thereto). If, after the receipt by the
Executive of an amount advanced by the Company pursuant to Paragraph (e) hereof,
a determination is made that the Executive shall not be entitled to any refund
with respect to such claim and the Company does not notify the Executive in
writing of its intent to contest such denial or refund prior to the expiration
of thirty (30) calendar days after such determination, then such advance shall
be forgiven and shall not be required to be repaid and the amount of any such
advance shall offset, to the extent thereof, the amount of Gross-Up Payment
required to be paid by the Company to the Executive pursuant to this Paragraph
6(c)(iii) of the Agreement.<PAGE>

                                                                   EXHIBIT 10.11

                             EMPLOYMENT AGREEMENT

          This Employment Agreement (this "Agreement") is entered into as of
February 20, 2000 ("Effective Date") between XCEL MANAGEMENT, INC., a Utah
corporation with its principal offices located at 1101 Broadway Plaza, Tacoma,
Washington 98402 (the "Company"), and James R. Leigh, III, a resident of
Washington (the "Employee").

     In consideration of the promises and the terms and conditions set forth in
this Agreement, the parties agree as follows:

     1.   Position. During the term of this Agreement, the Company will employ
          --------
the Employee, and the Employee will serve the Company in the capacity of Chief
Technical Officer. The Employee will report directly to John P. Gorst, the
Company's Chief Executive Officer and Chairman.

     2.   Duties. The Employee will perform duties described in Exhibit "A,"
          ------
attached to this Agreement and incorporated by this reference, together with
such additional duties assigned by the Chief Executive Officer or Board of
Directors.

     3.   Exclusive Service. The Employee will devote substantially all his
          -----------------
working time and efforts to the business and affairs of the Company. The
foregoing shall not, however, preclude the Employee: (a) from engaging in
appropriate civic, charitable or religious activities; (b) from serving on the
boards of directors of other entities, with the consent of the Company, which
consent shall not be unreasonably withheld; or (c) from providing incidental
assistance to family members on matters of family business, so long as the
foregoing activities and service do not conflict with the Employee's
responsibilities to the Company.

     4.   Term of Agreement.
          -----------------

          4.1  Initial Term. The Company agrees to continue the Employee's
               ------------
employment, and the Employee agrees to remain in the employ of the Company,
pursuant to the terms of this Agreement for a period of three (3) years after
the Effective Date, unless the Employee's employment is earlier terminated
pursuant to the provisions of this Agreement.

          4.2  Renewal. The term of this Agreement shall be extended
               -------
automatically, without further action of either party, as of three (3) years
after the Effective Date and on each succeeding anniversary of that date, for
terms of one (1) year, unless on or before ninety (90) days prior to the last
day of the term of this Agreement or any extension thereof, the Company or

                                       1
<PAGE>

the Employee shall notify the other in writing of its intention not to renew
this Agreement, in which case the Employee's employment shall terminate at the
end of the original term or any extension thereof. If either party notifies the
other of its intention not to renew this Agreement less than ninety (90) days
prior to the end of the term of this Agreement or any extension thereof, then
such termination shall be effective ninety (90) days from such notice. No notice
of non-renewal may be given by either party after a renewal term has commenced.
Any such renewal shall be upon such terms and conditions set forth in this
Agreement, unless otherwise agreed between the Company and the Employee. The
notice of non-renewal by either party shall in no way constitute a breach of
this Agreement.

     5.   Compensation and Benefits.
          -------------------------

          5.1  Base Salary. The Employee's initial base annual salary will be no
               -----------
less than $105,000 per year plus $8,000 bonus for the first year of his
employment with the Company. The Employee's base salary will be reviewed by the
Chief Executive Officer and/or Board of Directors at least annually and will be
increased to no less than $130,000 per year effective on the first anniversary
of the Effective Date and to no less than $150,000 per year effective on the
second anniversary of the Effective Date. Employee's salary will be payable as
earned in accordance with the Company's customary payroll practice.

          5.2  Additional Benefits. The Employee will be eligible to participate
               -------------------
in the Company's employee benefit plans of general application, including
without limitation pension and profit-sharing plans, stock option, incentive or
other bonus plans, life, health, disability, accident, vision and dental
insurance programs, paid vacations and sabbatical leave plans, and similar plans
or programs, in accordance with the rules established for individual
participation in any such plan. The Employee will also be entitled to reasonable
holidays and illness days with full pay in accordance with the Company's policy
from time to time in effect. The Employee will be entitled to the same benefits
extended to members of the senior executive staff of the Company, including but
not limited to vacation accrual.

          5.3  Additional Stock Options. On the Effective Date, the Employee
               ------------------------
shall be granted a compensatory stock option for 390,000 shares of the Company's
restricted Common Stock at an exercise price per share of $1.00 for the first
25,000 shares and $2.00 per share for the next 365,000 shares (the "Initial
Option"). The Initial Option shall be vested as to 25,000 shares on the
Effective Date. As to the remaining 365,000 shares and provided the Employee
continues to be engaged under this Agreement on each of the vesting dates, the
remainder of the Initial Option shall vest in the following manner: 121,666
shares on the one year anniversary of the Effective Date (February 20, 2001),
and thereafter 1/24 of the remaining shares subject to the Initial Option each
month the Employee continues to be engaged under this Agreement. The Initial
Option shall be fully vested on the third anniversary of the Effective Date. The
Initial Option cannot be transferred by the Employee except in the event of his
death, and must be exercised by the Employee (or in the event of his death, by
his estate or such other designee) within ten (10) years from the Effective
Date. Forms of permissible consideration to purchase the shares of restricted
common stock on exercise of the Initial Option shall be cash, cashless exercise

                                       2
<PAGE>

(also called net zero transaction), recourse promissory note and such other
forms of consideration with which other executives have or are given the
opportunity to purchase shares. In the event that the number of outstanding
shares of the Company's common stock is changed by a stock dividend,
recapitalization, stock split or similar change in the capital structure of the
Company without consideration, then the number of shares subject to the Initial
Option will be proportionately adjusted.

          5.4  Legal Expenses. The Company shall promptly reimburse the Employee
               --------------
for all reasonable legal expenses incurred by the Employee in connection with
the preparation of this Agreement, up to a maximum of $500.

          5.5  Expenses. The Company will reimburse (monthly) the Employee for
               --------
all reasonable and necessary expenses incurred by the Employee in connection
with the Company's business.

     6.   Termination.
          -----------

          6.1  Events of Termination. The Employee's employment with the Company
               ---------------------
shall terminate upon any one of the following:

          (a)  Thirty (30) days after the date of a written notice sent to the
Employee stating the Company's determination made in good faith that it is
terminating the Employee for "Cause" as defined under Section 6.2 below
("Termination for Cause"); or

          (b)  Thirty (30) days after the date of a written notice sent to the
Employee stating the Company's determination made in good faith that, due to a
mental or physical incapacity, the Employee has been unable to perform his
duties under this Agreement for a period of not less than six (6) consecutive
months ("Termination for Disability"); or

          (c)  Upon the Employee's death ("Termination Upon Death"); or

          (d)  Upon the date of a written notice sent to the Company stating the
Employee's determination made in good faith of "Constructive Termination" by the
Company, as defined under Section 6.3 below ("Constructive Termination"); or

          (e)  Thirty (30) days after the date of a notice sent to the Employee
stating that the Company is terminating his employment, without Cause, which
notice can only be given by the Company at any time after the Effective Date at
the Company's sole discretion, for any reason or for no reason ("Termination
Without Cause"); or

          (f)  The date of a notice sent to the Company from the Employee
stating that the Employee is electing to terminate his employment with the
Company ("Voluntary Termination").

                                       3
<PAGE>

          6.2  "Cause" Defined. For purposes of this Agreement, "Cause" for the
               ---------------
Employee's termination will exist at any time after the occurrence of one or
more of the following events:

          (a)  Any willful act or acts of dishonesty undertaken by the Employee
intended to result in substantial gain or personal enrichment of the Employee at
the expense of the Company; or

          (b)  Any willful act of gross misconduct which is materially and
demonstrably injurious to the Company. No act, or failure to act, by the
Employee shall be considered "willful" if done, or omitted to be done, by him in
good faith and in the reasonable belief that his act or omission was in the best
interest of the Company and/or required by applicable law.

          6.3  "Constructive Termination" Defined. "Constructive Termination"
               ----------------------------------
shall mean:

          (a)  A material reduction in the Employee's salary or benefits not
agreed to by the Employee;

          (b)  A material change in the Employee's responsibilities not agreed
to by the Employee;

          (c)  The Company's failure to comply in any material respect with any
material term of this Agreement after thirty (30) days written notice of the
Employee's claim of such failure; or

          (d)  A requirement that the Employee relocate to an office that would
increase the Employee's one-way commute distance by more than thirty (30) miles.

          6.4  "Termination Without Cause" shall mean:
               --------------------------

          (a)  Termination of the Employee's employment with the Company for any
reason other than Cause; or

          (b)  Termination of the Employee's employment with the Company for any
reason following a Change in Control. "Change in Control" shall mean the
occurrence of any of the following events: (i) a merger or consolidation
involving the Company in which the shareholders of the Company immediately prior
to such merger or consolidation own less that fifty percent (50%) of the voting
power of the surviving corporation; (ii) the sale of all, or substantially all,
of the assets of the Company; (iii) any "person" or "group" (as defined in the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) becoming the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) directly or
indirectly of securities representing more than fifty percent (50%) of the
voting power of the Company then outstanding; or (iv) less than a majority of
the Board of Directors are persons who were either nominated for election by the
Board of Directors or were elected by the Board of Directors.

                                       4
<PAGE>

     7.   Effect of Termination.
          ---------------------

          7.1  Termination for Cause or Voluntary Termination. In the event of
               ----------------------------------------------
any termination of the Employee's employment pursuant to Section 6.1(a) or
Section 6.1(f), the Company shall immediately pay to the Employee the
compensation and benefits accrued and otherwise payable to the Employee under
Section 5 through the date of termination. The Employee's rights under the
Company's benefit plans of general application shall be determined under the
provisions of those plans.

          7.2  Termination for Disability. In the event of termination of
               --------------------------
employment pursuant to Section 6.1(b):

          (a)  The Company shall immediately pay to the Employee the
compensation and benefits accrued and otherwise payable to the Employee under
Section 5 through the date of termination;

          (b)  For three (3) months after the termination of the Employee's
employment, the Company shall pay the Employee: (i) his salary under Section 5.1
above at the Employee's then-current salary, less applicable withholding taxes,
payable on the Company's normal payroll dates during that period; (ii)
healthcare premium for a period of three months;

          (c)  The Employee shall receive other benefit payments as provided in
the Company's standard benefit plans, and

          (d)  The Employee shall become fully and immediately vested in the
entire balance of his Initial Option under Section 5.3 above.

          7.3  Termination Upon Death. In the event of termination of employment
               ----------------------
pursuant to Section 6.1(c), all obligations of the Company and the Employee
shall cease, except the Company shall immediately pay to the Employee (or to the
Employee's estate) the compensation and benefits accrued and otherwise payable
to the Employee under Section 5 through the date of termination, and the
Employee shall become fully and immediately vested in the entire balance of his
Initial Option under Section 5.3 above.

          7.4  Constructive Termination or Termination Without Cause. In the
               -----------------------------------------------------
event of any termination of this Agreement pursuant to Section 6.1(d) or
Section 6.1(e):

          (a)  The Company shall immediately pay to the Employee the
compensation and benefits accrued and otherwise payable to the Employee under
Section 5 through the date of termination;

          (b)  For three (3) months after the termination of the Employee's
employment, the Company shall pay the Employee: (i) his salary under Section 5.1
above at the Employee's

                                       5
<PAGE>

then-current salary, less applicable withholding taxes, payable on the Company's
normal payroll dates during that period; (ii) healthcare premium for a period of
three months.

          (c)  If the termination occurs within the first (12) twelve months
following the Effective Date, in addition to the option for 25,000 shares vested
on the Effective Date, the Employee shall be vested in such number of shares of
the Initial Option provided in Section 5.3 equal to the product of 121,666
multiplied by the result of dividing the number of months the Employee has
provided services to the Company by twelve.

          (d)  If the termination occurs for any reason after a Change in
Control, then in addition to the foregoing benefits, the remainder of the
Initial Option provided in Section 5.3 shall, as of the date of employment
termination, be immediately vested in full and shall remain exercisable for the
periods specified in Section 5.3; provided, that if the total amount of the
benefits available to the Employee under this Section 7.4, either alone or
together with other payments which the Employee has the right to receive from
the Company, would constitute a "parachute payment" as defined in Section 280G
of the Internal Revenue Code (the "Code"), then the Employee will receive
whichever provides him with the greater economic benefit: (i) the total amount
of such benefits; or (ii) the largest amount that would result in no portion of
such benefits being subject to the excise tax imposed by Section 4999 of the
Code. The determination of which of the foregoing would provide the greatest
economic benefit to the Employee shall be made by an independent accounting firm
the fees for which determination shall be paid by the Company.

     8.   Nondisclosure. The Employee acknowledges that during the course of his
          -------------
employment by the Company, the Company will provide, and the Employee will
acquire, knowledge of special and unique value with respect to the Company's
business operations, including, by way of illustration, the Company's existing
and contemplated product line, trade secrets, compilations, business and
financial methods or practices, plans, hardware and software technology
products, systems, programs, projects and know-how, pricing, cost of providing
service and equipment, operating and maintenance costs, marketing and selling
techniques and information, customer data, customer names and addresses,
customer service requirements, supplier lists, and confidential information
relating to the Company's policies, employees, and/or business strategy (all of
such information herein referenced to as the "Confidential Information"). The
Employee recognizes that the business of the Company is dependent upon
Confidential Information and that the protection of the Confidential Information
against unauthorized disclosure or use is of critical importance to the Company.
The Employee agrees that, without prior written authorization of the Chief
Executive Officer of the Company, the Employee will not, during his employment,
divulge to any person, directly or indirectly, except to the Company or its
officers and agents or as reasonably required in connection with the Employee's
duties on behalf of the Company, or make any independent use of, except on
behalf of the Company, any of the Company's Confidential Information, whether
acquired by the Employee during his employment or not. The Employee further
agrees that the Employee will not, at any time after his employment has ended,
use or divulge to any person directly or indirectly any Confidential
Information, or use any Confidential Information in subsequent employment of any
nature. If the

                                       6
<PAGE>

Employee is subpoenaed, or is otherwise required by law to testify concerning
Confidential Information, the Employee agrees to notify the Company upon receipt
of a subpoena, or upon belief that such testimony shall be required. This
nondisclosure provision shall survive the termination of this Agreement for any
reason. The Employee acknowledges that the Company would not employ the Employee
but for his covenants and promises contained in this Section 8.

     9.   Return of Documents. The Employee agrees that if the Employee's
          -------------------
relationship with the Company is terminated (for whatever reason), the Employee
shall not remove or take with the Employee, but will leave with the Company or
return to Company, all Confidential Information, records, files, data,
memoranda, reports, customer lists, customer information, product information,
price lists, documents and other information, in whatever form (including on
computer disk), and any and all copies thereof, or if such items are not on the
premises of the Company, the Employee agrees to return such items immediately
upon the Employee's termination or the request of the Company. The Employee
acknowledges that all such items are and remain the property of the Company.

     10.  No Interference or Solicitation. The Employee agrees that during his
          -------------------------------
employment, and for a period of six (6) months following the termination of his
employment (for whatever reason), that neither he nor any individual,
partner(s), limited partnership, corporation or other entity or business with
which he is in any way affiliated, including, without limitation, any partner,
limited partner, director, officer, shareholder, employee, or agent of any such
entity or business, will: (i) request, induce or attempt to influence, directly
or indirectly, any employee of the Company to terminate their employment with
the Company; or (ii) employ any person who as of the date of this Agreement was,
or after such date is or was, an employee of the Company. The Employee further
agrees that during the period beginning with the commencement of the Employee's
engagement with the Company and ending six (6) months after the termination of
the Employee's employment with the Company (for whatever reason), he shall not,
directly or indirectly, as an employee, agent, consultant, stockholder,
director, partner or in any other individual or representative capacity of the
Company or of any other person, entity or business, solicit or encourage any
present or future customer, supplier, contractor, partner or investor of the
Company to terminate or otherwise alter his, his or its relationship with the
Company. This provision shall survive the termination of this Agreement for any
reason.

     11.  Non-Competition. In consideration of the numerous mutual promises
          ---------------
contained in the Agreement between the Company and the Employee, including,
without limitation, those involving Confidential Information, and in order to
protect the Company's Confidential Information and to reduce the likelihood of
irreparable damage which would occur in the event such information is provided
to or used by a competitor of the Company, the Employee agrees that during his
employment and for an additional period of six (6) months immediately following
the termination of his employment, whether voluntary or involuntary (the "Non-
Competition Term"), not to, directly or indirectly, either through any form of
ownership or as a director, officer, principal, agent, employee, employer,
adviser, consultant, shareholder, partner, or in any individual or
representative capacity whatsoever, without the prior written consent of the
Company (which consent may be withheld in its sole discretion): (i) compete for
or solicit business related to application service provider services for or on
behalf of any person or business entity with a place of business in the United
States or Canada; (ii) own, operate,

                                       7
<PAGE>

participate in, undertake any employment with or have any interest in any entity
with a place of business in the United States or Canada in the business of
marketing and selling of application service provider services to persons or
business entities, except owning publicly traded stock for investment purposes
only in which the Employee owns less than 5%; (iii) compete for or solicit
application service provider services business from any customer of the Company
(or its successors by merger); or (iv) use in any competition, solicitation, or
marketing effort any Confidential Information, any proprietary list, any
information concerning customers of the Company.

     If, during any period within the Non-Competition Term, the Employee is not
in compliance with the terms of this Section 11, the Company shall be entitled
to, among other remedies, compliance by the Employee with the terms of this
Section 11 for an additional period equal to the period of such noncompliance.
For purposes of this Agreement, the term "Non-Competition Term" shall also
include this additional period. The Employee hereby acknowledges that the
geographic boundaries, scope of prohibited activities and the time duration of
the provisions of this Section 11 are reasonable and are no broader than are
necessary to protect the legitimate business interests of the Company.

     This non-competition provision shall survive the termination of the
Employee's employment and can only be revoked or modified by a writing signed by
the parties which specifically states an intent to revoke or modify this
provision. The Employee acknowledges that the Company would not employ him but
for his covenants or promises contained in this Section 11.

     12.  Reformation of Section 11. The Company and the Employee agree and
          -------------------------
stipulate that the agreements and covenants not to compete contained in Section
11 hereof are fair and reasonable in light of all of the facts and
circumstances of the relationship between the Employee and the Company; however,
the Employee and the Company are aware that in certain circumstances courts have
refused to enforce certain agreements not to compete. Therefore, in furtherance
of, and not in derogation of the provisions of Section 11, the Company and the
Employee agree that in the event a court should decline to enforce the
provisions of Section 11, that Section 11 shall be deemed to be modified or
reformed to restrict the Employee's competition with the Company or its
affiliates to the maximum extent, as to time, geography and business scope,
which the court shall find enforceable; provided, however, in no event shall the
provisions of Section 11 be deemed to be more restrictive to the Employee than
those contained herein.

     12.  Injunctive Relief. The Employee acknowledges and agrees that the
          -----------------
agreements and covenants contained in this Agreement are essential to protect
the Confidential Information, business, and goodwill of the Company. The
Employee further acknowledges that the breach of any of the agreements contained
herein, including, without limitation, the confidentiality covenants specified
in Section 8, the non-solicitation covenants specified in Section 10, and the
non-competition covenants contained in Section 11, will give rise to irreparable
injury to the Company, inadequately compensable in damages. Accordingly, the
Company shall be entitled to injunctive relief to prevent or cure breaches or
threatened breaches of the provisions of this

                                       8
<PAGE>

Agreement and to enforce specific performance of the terms and provisions hereof
in any court of competent jurisdiction, in addition to any other legal or
equitable remedies which may be available. The Employee further acknowledges and
agrees that in the event of the termination of the Employee's employment with
the Company, whether voluntary or involuntary, that the enforcement of a remedy
hereunder by way of injunction shall not prevent the Employee from earning a
reasonable livelihood. The Employee further acknowledges and agrees that the
covenants contained herein are necessary for the protection of the Company's
legitimate business interests and are reasonable in scope and content.

     13.  Miscellaneous
          -------------

          13.1   Indemnification and Errors and Omissions Insurance. The Company
                 --------------------------------------------------
agrees to indemnify and defend the Employee on terms no less favorable than any
indemnification agreement the Company has at any time during the term of this
Agreement with an executive or officer of the Company.

          13.2   Arbitration. The Employee and the Company shall submit to
                 -----------
mandatory binding arbitration in any controversy or claim arising out of, or
relating to, this Agreement or any breach hereof. Such arbitration shall be
conducted in accordance with the commercial arbitration rules of the American
Arbitration Association in effect at that time, and judgment upon the
determination or award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. The arbitrator is hereby authorized to award to the
prevailing party the costs (including reasonable attorneys' fees and expenses)
of any such arbitration.

          13.3   Severability. If any provision of this Agreement shall be found
                 ------------
by any arbitrator or court of competent jurisdiction to be invalid or
unenforceable, then the parties hereby waive such provision to the extent that
it is found to be invalid or unenforceable and to the extent that to do so would
not deprive one of the parties of the substantial benefit of its bargain. Such
provision shall, to the extent allowable by law and the preceding sentence, be
modified by such arbitrator or court so that it becomes enforceable and, as
modified, shall be enforced as any other provision hereof, all the other
provisions continuing in full force and effect.

          13.4   No Waiver. The failure by either party at any time to require
                 ---------
performance or compliance by the other of any of its obligations or agreements
shall in no way affect the right to require such performance or compliance at
any time thereafter. The waiver by either party of a breach of any provision
hereof shall not be taken or held to be a waiver of any preceding or succeeding
breach of such provision or as a waiver of the provision itself. No waiver of
any kind shall be effective or binding, unless it is in writing and is signed by
the party against whom such waiver is sought to be enforced.

          13.5  Assignment. This Agreement and all rights hereunder are
                ----------
personal to the Employee and may not be transferred or assigned by the Employee
at any time. The Company may assign its rights, together with its obligations
hereunder, to any parent, subsidiary, affiliate or successor, or in connection
with any sale, transfer or other disposition of all or substantially all of

                                       9
<PAGE>

its business and assets, provided, however, that any such assignee assumes the
Company's obligations hereunder.

          13.6  Withholding. All sums payable to the Employee hereunder shall be
                -----------
reduced by all federal, state, local and other withholding and similar taxes and
payments required by applicable law.

          13.7  Entire Agreement. This Agreement constitutes the entire and only
                ----------------
agreement between the parties relating to employment of the Employee with the
Company, and this Agreement supersedes and cancels any and all previous
contracts, arrangements or understandings with respect thereto.

          13.8  Amendment. This Agreement may be amended, modified, superseded,
                ---------
cancelled, renewed or extended only by an agreement in writing executed by both
parties hereto.

          13.9  Notices. All notices and other communications required or
                -------
permitted under this Agreement shall be in writing and hand delivered, sent by
telecopier, sent by registered first class mail, postage pre-paid, or sent by
nationally recognized express courier service. Such notices and other
communications shall be effective upon receipt if hand delivered or sent by
telecopier, five (5) days after mailing if sent by mail, and one (1) day after
dispatch if sent by express courier, to the following addresses, or such other
addresses as any party shall notify the other parties:

          If to the Company:

                XCEL MANAGEMENT, INC.
                Attn:  John P. Gorst
                1101 Broadway Plaza
                Tacoma, Washington 98402

          If to the Employee:
                James R. Leigh, III
                7915 Eastside Drive NE
                Tacoma, WA 98422

          13.10 Binding Nature. This Agreement shall be binding upon, and inure
                --------------
to the benefit of, the successors and personal representatives of the respective
parties hereto.

          13.11 Headings. The headings contained in this Agreement are for
                --------
reference purposes only and shall in no way affect the meaning or interpretation
of this Agreement. In this Agreement, the singular includes the plural, the
plural included the singular, the masculine gender includes both male and female
referents, and the word "or" is used in the inclusive sense.

                                       10
<PAGE>

          13.12 Counterparts. This Agreement may be executed in two or more
                ------------
counterparts, each of which shall be deemed to be an original but all of which,
taken together, constitute one and the same agreement.

          13.13 Governing Law. This Agreement and the rights and obligations of
                -------------
the parties hereto shall be construed in accordance with the laws of the State
of Washington, without giving effect to the principles of conflict of laws.

          13.14 Attorneys' Fees. In the event of any claim, demand or suit
                ---------------
arising out of or with respect to this Agreement, the prevailing party shall be
entitled to reasonable costs and attorneys' fees, including any such costs and
fees upon appeal.

          IN WITNESS WHEREOF, the Company and the Employee have executed this
Agreement as of the date first above written.

"THE COMPANY"                           "EMPLOYEE"

XCEL MANAGEMENT, INC.

By: /s/ John P. Gorst                   /s/ James R. Leigh, III
    --------------------------          ----------------------------

John P. Gorst                           James R. Leigh, III
Chief Executive Officer & Chairman

                                       11
<PAGE>

                                  EXHIBIT "A"
                                      TO
                             EMPLOYMENT AGREEMENT

                              DUTIES OF EMPLOYEE
                              ------------------

                                       12

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