Exhibit 10.37
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 Xxxxx (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 Vice President and General
Counsel of the Company, reporting to the Chairman and Chief Executive 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 $110,000 per annum, subject to 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 35 percent (35%), 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 shall be granted, as
of September 24, 1999, an incentive stock option to purchase 25,000 shares of
the Company's common stock, priced at $20.50. One third of the option shall vest
upon the first anniversary of the Effective Date, with the balance vesting in
equal one twelfth 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. 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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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) or
until the Executive is newly employed at a base salary equal to or
greater than the Executive's Annual Base Salary, whichever occurs
first;
(b) In the event the Executive secures new
employment with a base salary lower than the Annual Base Salary, the
Company will pay to Executive for the remainder of the Term the
difference between the base salary and Annual Base Salary;
(c) 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.
(d) Pay any earned bonus and unused vacation
pay.
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.
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 (whether
such person is presently employed by the Company or may later be
employed), to leave the Company's employ or
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otherwise interfere with the employment relationship between any such
person and the Company;
(ii) solicit, or attempt to divert, take
away or call on, any exclusive suppliers, customers or potential
customers of the Company; or
(iii) disparage the Company, its operations,
business, Board, directors, officers, management or employees; or
(iv) compete with the Company or its
subsidiaries in the ASP market anywhere in the United States;
(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.
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 Xxxxxxxxxxx X. XxXxxxxx
Chairman & Chief Executive Xxxxxxx
Xxxxxxx XXX XXX XXXXX, XXXXXXXXX, XX 00000-0000
WITNESS: ______________________
Name:
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