EXHIBIT 10.9
XXXXXXXXXXX.XXX, INC. AND XXXXX X. XXXXX
AGREEMENT AND UNDERSTANDING
This Agreement and Understanding (this "AU") is made and entered into
as of September 17, 1999 (the "Effective Date"), by and between Xxxxxxxxxxx.xxx,
Inc., a Delaware corporation (the "Company"), and Xxxxx X. Xxxxx, an individual
("Xxxxx"). For purposes of this AU, unless otherwise specified, the term
"Company" shall include Xxxxxxxxxxx.xxx, L.L.C. and Extranet Solutions, L.L.C.,
as predecessors in interest to Xxxxxxxxxxx.xxx, Inc.
RECITALS
WHEREAS, the Company and Xxxxx are parties to an employment agreement
and other related agreements made as of January 1, 1999, including that certain
letter agreement dated February 1, 1999 (the "Prior Agreements");
WHEREAS, pursuant to the Prior Agreements, Xxxxx acquired an equity
interest in the Company, subject to the terms and conditions of the Prior
Agreements (the "Equity Interest");
WHEREAS, the Company is currently in the process of changing the legal
form of its business from that of a Delaware limited liability company to a
Delaware corporation (the "Conversion") and issuing shares of its Series B
Preferred Stock to certain investors after the consummation of the Conversion
(the "Series B Financing"); and
WHEREAS, the Company and Xxxxx wish to clarify and confirm their
agreement and understanding with respect to certain matters relating to the
Equity Interest and employment with the Company.
NOW, THEREFORE, the parties agree and acknowledge the following:
1. As of the Effective Date, the Company shall pay Xxxxx as
compensation for his services a base salary at the annualized rate of one
hundred and fifty thousand dollars ($150,000). Such salary shall be paid
periodically in accordance with normal Company payroll practices and shall be
subject to the usual, required withholding.
2. At the first Board meeting following the Effective Date, Xxxxx
shall be granted a stock option to purchase fifteen thousand (15,000) shares of
the Company's Common Stock at an exercise price equal to the then current fair
market value as determined by the Board at such meeting (the "Option"). The
Option shall vest as to 25% of the shares subject to the Option one year after
the date of grant and as to 1/36th of the remaining shares subject to the Option
monthly thereafter, so as to be fully vested and exercisable four (4) years from
the date of grant, subject to Xxxxx'x continued service with the Company. In all
other respects, the Option shall be subject to the terms, definitions and
provisions of the Company's 1999 Stock Plan.
3. Concurrent with the execution of this AU, the Company and Xxxxx
shall execute the Xxxxx Stock Vesting Agreement (the "Stock Vesting Agreement"),
which is attached hereto as
Exhibit A and incorporated by reference herein. The Stock Vesting Agreement sets
forth Xxxxx'x Equity Interest immediately following the Conversion. In addition,
the Vesting Stock Agreement describes the vesting conditions relating to such
equity interest. The parties agree and acknowledge that the Vesting Stock
Agreement accurately reflects such equity interest and vesting therein. Xxxxx
further agrees and acknowledges that neither the Vesting Stock Agreement nor any
other agreement to which Xxxxx is a party provides any anti-dilution rights in
connection with Xxxxx'x equity interest in the Company.
4. PRIOR AGREEMENTS. The parties agree that promptly following the
Series B Financing, they shall amend and restate the Prior Agreements as
necessary and appropriate to reflect the foregoing and the change in the legal
form of the Company's business from that of a Delaware limited liability company
to a Delaware corporation.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of
the day and year first above set forth.
XXXXXXXXXXX.XXX, INC.
By:
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Xxxx X. Warms
Chief Executive Officer
NAME
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Xxxxx X. Xxxxx
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