Exhibit 10.32
[USI LOGO] CONFIDENTIAL
USINTERNETWORKING, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (the "AGREEMENT") dated as of
September 24, 1999, (the "Effective Date") is made by and between
USinternetworking, Inc., a Delaware corporation (together with any successor
thereto, the "COMPANY") and Xxxxxxx X. Xxxxxx (the "EXECUTIVE").
In consideration of the mutual promises made below, the Company and
Executive agree as follows:
1. POSITION AND DUTIES.
The Executive shall, for a period of 3 years from the Effective
Date ("TERM"), serve as President of People Soft Business Unit of the
Company, reporting to Xxxxxx Xxxxx the Chief Operating Officer of the
Company. The title and reporting relationships may change as a result of
promotions or reorganizations during the term of this Agreement.
2. COMPENSATION AND OTHER RELATED BENEFITS
(a) ANNUAL BASE SALARY. During the Term the Executive shall
receive a base salary at a rate of $175,000 per annum, subject to annual
review at the end of each calendar year and increase as determined by the
Executive's supervisor and approved by the Compensation Committee ("ANNUAL
BASE SALARY").
(b) BONUS. The Executive shall be eligible to receive a
discretionary target bonus of 50 percent (50%) with a maximum bonus of 100
percent (100%), of the Executive's Annual Base Salary to be paid at the
conclusion of each calendar year of the Term.
(c) STOCK OPTIONS. The Executive has been granted an
additional non-qualified stock option to purchase 62,500 shares at a strike
price of $6.00 per share on March 19, 1999, and as of September 24, 1999,
shall be granted an incentive stock option to purchase 22,500 shares of the
Company's common stock, priced at $20.50. One third of each option shall vest
upon the first anniversary of the Effective Date of each grant, with the
balance vesting in equal one-eighth increments each successive quarter of the
Term. Future option grants may be made at the discretion of the Compensation
Committee.
(d) OTHER BENEFITS. The Executive shall be entitled to
flexible benefit plans, which include medical, dental and vision plan for
himself and family members without Executive contribution to plan premiums
and such other benefits which the Company provides to other Executives. The
Company also provides long-term disability and two times base pay in life
insurance. The Company's 401(k) plan offers a choice of various investment
funds. Additionally, the Executive will be eligible for fifteen (15) days of
vacation each year of the Term, accrued at the rate of 1.25 days per full
calendar month of the Term.
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[USI LOGO] CONFIDENTIAL
3. TERMINATION WITHOUT CAUSE
If the Company terminates the Executive without Cause, the
Company will compensate the Executive as follows:
(a) Continue to pay the Annual Base Salary, normal health
care benefits and life insurance until the end of the Term or for a
minimum period of 12 months (which ever is greater); provided however
if Executive is newly employed at a base salary at least equal to
Executive's Annual Base Salary upon termination, such payments shall
terminate. If Executive becomes employed at a base salary less than
Executive's Annual Base Salary upon termination, the Company shall
only be obligated to pay the difference between such Annual Base
Salary and the new Base Salary.
(b) Accelerate the vesting of all unvested options held by
the Executive and grant a one hundred twenty (120) day period in which
to exercise the options.
(c) Pay any unused vacation pay.
(d) Pay a bonus at least equal to the bonus received for the
prior year of the Term pro rated to the number of days in the current
year.
Termination without Cause shall include requiring Executive to
move more than 50 miles to execute his position or being assigned
responsibilities of a lessor nature than President of an Operating Business
Unit.
Additionally, if there is a Change of Control of the Company,
(within the meaning of Rule 13d-3 under the Exchange Act) the "Constructive
Termination" of employment, defined as substantial change to or reduction of
Executive's job responsibilities, shall be considered Termination without
Cause for purposes of this Agreement.
4. TERMINATION FOR CAUSE
If the Executive's employment is terminated for "Cause" by the
Company, a thirty (30) day notice will be given to the Executive and if the
Cause is not cured after the thirty (30) day notice period, the Executive
will be terminated without any severance pay or benefits. "CAUSE" is defined
as any one of the following:
1. Willful neglect of assigned duties so as to cause
material harm to the Company.
2. Willful misconduct that materially and adversely
impacts the reputation of the Company.
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[USI LOGO] CONFIDENTIAL
The Executive may, at the Company's option, be terminated
without notice and for "Cause" if the following events occur:
3. Conviction of a felony or a crime involving moral
turpitude.
4. Fraud of personal dishonesty involving Company assets.
5. POST-TERMINATION ACTIVITIES
(a) The Executive agrees that during his/her employment with
the Company and for 12 months thereafter, the Executive will not, and will
not cause others to:
(i) solicit or induce or attempt to solicit or induce any
employee or full time consultant of the Company, to leave the Company's
employ or otherwise interfere with the employment relationship between
any such person and the Company;
(ii) solicit any exclusive suppliers, existing customers at
the time of the Executives termination or specific and targeted
potential customers of the Company; provided the Executive is
attempting to obtain from such customer or targeted potential customer
business of the type the Company was providing or offering to provide
immediately prior to the Executives termination, or
(iii) disparage the Company, its operations, business, Board,
directors, officers, management or employees; or
(iv) directly compete with USI's primary ASP service
offerings anywhere in the United States without obtaining prior written
permission from USI;
(b) In the event the terms of this SECTION 5 shall be
determined by any court of competent jurisdiction to be unenforceable by
reason of its time period or geographic scope, the terms will be interpreted
to extend only over the maximum period of time and geographic scope which the
court determines are enforceable.
6. NONDISCLOSURE OF CONFIDENTIAL INFORMATION.
The Executive shall not improperly disclose any confidential
information or trade secrets of the Company during the course of his/her
employment and for a period of thirty-six (36) months thereafter.
7. GOVERNING LAW. This Agreement shall be interpreted and enforced
in accordance with the laws of the State of Maryland.
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[USI LOGO] CONFIDENTIAL
8. NOTICES. Any notice under this Agreement shall be in writing and
delivered by fax, e-mail or registered mail to the signatories at the
addresses below.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
and year first above written.
THE EXECUTIVE: THE COMPANY:
________________________ By: ___________________________________
Name Xxxxxx Xxxxx
Address XXX XXX XXXXX, XXXXXXXXX, XX 00000-0000
WITNESS: ______________________
Name:
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