Equinix, Inc.
Exhibit
10.38
Equinix,
Inc.
July 22,
2008
Xx.
Xxxxxxxx X. Xxxxxxx
Dear
Xxxxxxxx:
This
letter (the “Agreement”) confirms the agreement between you and Equinix, Inc.
(the “Company”) regarding the continuation of your employment with the Company
and the benefits we would like to offer you following your cessation of
employment.
1. Continuing
Employment. Your employment with the Company will continue
through the earlier of (a) February 15, 2009, or (b) the date you
commence full-time employment for a new employer, provided that you may resign
your employment on any earlier date. The Company may terminate your
employment prior to February 15, 2009 only for Cause. For purposes of
this Agreement, the “Termination Date” shall mean the date that your employment
ends. You agree to notify the Company in writing immediately upon
accepting new employment. While you are employed
by the Company, you may engage in part-time employment and consulting work
provided it does not create a conflict of interest with the Company, as
determined in the reasonable discretion of the Company’s Chief Executive
Officer or General Counsel. Our mutual understanding is that your
working hours will be reduced to 50% of a full-time equivalent beginning
November 1, 2008 through December 31, 2008 and your working hours may be
further reduced to 20% of a full-time equivalent thereafter or may remain at 50%
of a full-time equivalent if warranted based on the projects assigned to
you. Our mutual understanding is also that you will work closely with
the Company’s Chief Executive Officer through your Termination Date on special
projects. For purposes of this Agreement, “Cause” means (a) an
unauthorized use or disclosure of the Company’s confidential information or
trade secrets, which use or disclosure causes harm to the Company, (b) a
material failure to comply with the Company’s written policies or rules,
(c) conviction of, or plea of “guilty” or “no contest” to, a felony under
the laws of the United States or any state thereof, (d) gross misconduct,
(e) continued failure to perform lawfully assigned duties after receiving
written notification of such failure from the Company’s Chief Executive Officer
and thirty (30) days to cure such failure to perform, or (f) engaging in
activities prohibited by Section 11 or 15 of this Agreement.
2. Salary, Bonus and
PTO. Through the Termination Date, you will continue to be
paid the salary you are currently earning, adjusted as necessary to reflect your
reduction in hours in accordance with existing payroll
practices. While you remain employed, you will continue to be
provided all employee benefits for which you are eligible through and until the
date your employment ends. In addition, while employed, you will
continue to accrue PTO to
the extent provided for and in accordance with the Company’s existing
policies. Any bonus that is earned for services you perform for 2008
will be paid on February 15, 2009 or earlier if the Compensation Committee
determines on an earlier date that the performance milestones have been
satisfied. You will not be eligible for a bonus or other incentive
compensation for services performed in 2009. As of the date of this
Agreement, you will no longer be entitled to the severance benefits detailed in
the Severance Agreement dated August 22, 2002 currently in effect between you
and the Company. You agree that the only payments and benefits that
you are entitled to receive from the Company in the future are those specified
in this Agreement or the terms of the Company benefit plans.
3. COBRA. Should your
working hours fall below the number of hours required to maintain your
enrollment in the Company’s health plans and, in any event, following the
Termination Date, you will receive information about your right to continue your
group health insurance coverage under the Consolidated Omnibus Budget
Reconciliation Act (“COBRA”). In order to continue your coverage, you
must file the required election form and pay the applicable
premium.
4. Stock. You
understand and agree that you were granted and continue to hold the rights to
shares of the Company’s common stock listed in the table. As of
February 15, 2009, you will be vested in the number of shares indicated in
the table provided the applicable performance measures are met as confirmed
by the Compensation Committee by that time. If you remain employed with
the Company through February 15, 2009, then you will be vested in the additional
number of restricted stock awards as indicated in the table, which reflects
vesting as if you remained employed through July 1, 2009 (the table assumes
satisfaction of the applicable performance measures). To vest in the
July 1, 2009 installments as of February 15, 2009, you must sign this
Agreement, be continuously in employment through February 15, 2009, agree to not
engage in Competitive Activities (as defined in Section 11 below) and sign the
release attached hereto as Exhibit A (the
“Second Release”) within 5 days following your cessation of
employment.
|
Type
of Award
|
Grant
Date
|
Number
of Shares
|
Exercised
or released as of
7/18/08
|
Price
|
Vested/
Released
as of
2/15/09
|
Vested/
Released
as of
7/1/09
|
|||||||||||||||
|
Incentive
stock option
|
11/10/1999
|
14,063 | 3,516 | $ | 32.00000 | 14,063 | 14,063 | ||||||||||||||
|
Non-qualified
option
|
6/13/2000
|
1,750 | 0 | $ | 224.00000 | 1,750 | 1,750 | ||||||||||||||
|
Non-qualified
option
|
1/9/2001
|
3,825 | 0 | $ | 119.00160 | 3,825 | 3,825 | ||||||||||||||
|
Non-qualified
option
|
1/9/2001
|
82 | 0 | $ | 122.00000 | 82 | 82 | ||||||||||||||
|
Non-qualified
option
|
9/26/2001
|
10,938 | 10,938 | $ | 12.16000 | 10,938 | 10,938 | ||||||||||||||
|
Non-qualified
option
|
4/22/2002
|
4,688 | 4,688 | $ | 22.40000 | 4,688 | 4,688 | ||||||||||||||
|
Non-qualified
option
|
3/6/2003
|
100,000 | 100,000 | $ | 3.25000 | 100,000 | 100,000 | ||||||||||||||
|
Non-qualified
option
|
2/9/2004
|
52,000 | 50,000 | $ | 30.02000 | 52,000 | 52,000 | ||||||||||||||
|
RSA
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2/8/2005
|
31,000 | 27,125 | $ | 0.00 | 3,875 | 3,875 | ||||||||||||||
|
RSA
|
1/10/2006
|
25,000 | 15,625 | $ | 0.00 | 3,125 | 6,250 | ||||||||||||||
|
RSA
|
1/2/2007
|
6,500 | 4,334 | $ | 0.00 | 2,166 | 2,166 | ||||||||||||||
|
RSA
|
1/2/2007
|
15,000 | 2,500 | $ | 0.00 | 2,500 | 5,000 | ||||||||||||||
|
RSU
|
1/31/2008
|
9,500 | 0 | $ | 0.00 | 4,750 | 4,750 | ||||||||||||||
All
of your options are currently vested. Each of the shares of the
Company’s common stock issuable under RSAs listed in the table will be issued to
you or credited to an account in your name when vested. Each of the
RSUs listed in the table will be settled when vested. Upon vesting of
shares and settlement of rights, the Company will collect all applicable income
and employment taxes. Your participation in the Company’s Employee
Stock Purchase Plan will continue through the Termination Date or any earlier
reduction in hours worked to 20 hours per week or fewer. Any payroll
deductions accumulated but not used to purchase shares as of your last day
worked will be refunded to you following your last day worked. All
terms, conditions and limitations applicable to the purchase rights pursuant to
the Company’s Employee Stock Purchase Plan shall remain in full force and
effect. You acknowledge that you currently have no other stock rights
in the Company other than those rights enumerated in this paragraph, other than
shares you own and that are in your possession. You further
acknowledge that all terms, conditions and limitations applicable to your stock,
options and stock rights pursuant to the applicable stock award agreement,
including provisions for acceleration of vesting on a Change in Control, as set
forth in the applicable agreement and the Company’s 2000 Equity Incentive Plan,
shall remain in full force and effect.
5. Release of All
Claims. In consideration for agreeing to continue your
employment on the terms set forth herein and the opportunity to continue vesting
in your equity awards, to the fullest extent permitted by law, you waive,
release and promise never to assert any claims or causes of action, whether or
not now known, against the Company or its predecessors, successors or past or
present subsidiaries, stockholders, directors, officers, employees, consultants,
attorneys, agents, assigns and employee benefit plans with respect to any
matter, including (without limitation) any matter related to your employment
with the Company or the termination of that employment, including (without
limitation) claims to attorneys’ fees or costs, claims of wrongful discharge,
constructive discharge, emotional distress, defamation, invasion of privacy,
fraud, breach of contract or breach of the covenant of good faith and fair
dealing and any claims of discrimination or harassment based on sex, age, race,
national origin, disability or any other basis under Title VII of the Civil
Rights Act of 1964, the California Fair Employment and Housing Act, the Age
Discrimination in Employment Act of 1967, the Americans with Disabilities Act
and all other laws and regulations relating to employment. However,
this release covers only those claims that arose prior to the execution of this
Agreement and only those claims that may be waived by applicable
law. Execution of this Agreement does not bar any claim that arises
hereafter, including (without limitation) a claim for breach of this
Agreement.
6. Waiver. You
expressly waive and release any and all rights and benefits under
Section 1542 of the California Civil Code (or any analogous law of any
other state), which reads as follows: “A general release does not
extend to claims which the creditor does not know or suspect to exist in his or
her favor at the time of executing the release, which if known by him or her
must have materially affected his or her settlement with the
debtor.”
7. Promise Not To
Xxx. You agree that you will never, individually or with any
other person, commence, aid in any way (except as required by legal process) or
prosecute,or cause
or permit to be commenced or prosecuted, any action or other proceeding based on
any claim that is the subject of this Agreement.
8. Effective Date and
Revocation. You have up to 21 days after you receive this
Agreement to review it. You are advised to consult an attorney of
your own choosing (at your own expense) before signing this
Agreement. Furthermore, you have up to seven days after you sign this
Agreement to revoke it. If you wish to revoke this Agreement after
signing it, you may do so by delivering a letter of revocation to
me. If you do not revoke this Agreement, the eighth day after the
date you sign it will be the “Effective Date.” Because of the
seven-day revocation period, this Agreement will not become effective or
enforceable until the Effective Date.
9. Xxxxxxx Xxxxxxx
Policy. You agree that you will comply with the Company’s
xxxxxxx xxxxxxx policy.
10. Indemnification. You
and the Company understand and agree that nothing in this Agreement shall modify
in any manner any indemnification and/or insurance rights you may have pursuant
to the Company’s Certificate of Incorporation, Bylaws, the Indemnification
Agreement between you and the Company dated November 8, 1999, or any applicable
insurance policy for officers and directors liability.
11. Non-Competition. You
agree that the additional vesting set forth in Section 4 above will not be
earned if, during the period beginning on the Termination Date and ending on
February 15, 2010, you directly or indirectly own any interest in, manage,
control, participate in (whether as an officer, director, employee, partner,
agent, representative or otherwise), consult with or render services for, or in
any manner engage in any business competing with, or similar to the business of,
the Company anywhere within any state, possession, territory or jurisdiction of
the United States of America, Canada, or in any of the countries in Central
America, South America, Europe, Asia, Africa and Australia. Such
competitive businesses include, but are not limited to, Digital Realty Trust,
Xxxxx 0, Xxxxxx, Xxxxxx & Data, Terremark, Dupont Fabros, Telecity,
Interxion, Telx, Global Switch, 365 Main and other regional/global companies in
the business of, or having a line of business in, colocation or
interconnection. If any restriction set forth in this Section 11
is held to be unreasonable or unenforceable by a court of competent
jurisdiction, then you agree, and hereby submit, to the reduction and limitation
of such prohibition to such area or period as shall be deemed reasonable. You
may own, directly or indirectly, solely as an investment, up to 1% of any class
of securities that is publicly traded and you may own, directly or indirectly,
solely as an investment, up to 1% of any investment fund with respect to which
you do not make investment decisions. In addition, if you violate the
restrictions set forth in this Section 11 on or before February 15, 2010, then
you agree to forfeit the shares earned through the additional vesting set
forth in Section 4 (or if sold, the gross proceeds realized on a sale of such
shares).
12. No
Admission. Nothing contained in this Agreement will
constitute or be treated as an admission by you or the Company of liability, any
wrongdoing or any violation of law.
13. Other
Agreements. At all times in the future, you will remain
bound by your Proprietary Information and Inventions Agreement with the Company,
which you signed on October 28, 1999, and a copy of which is attached as Exhibit B. Except
as expressly provided in this Agreement, this Agreement renders null and void
all prior agreements between you and the Company and constitutes the entire
agreement between you and the Company regarding your continued employment and
your eligibility for severance benefits. This Agreement may be
modified only in a written document signed by you and a duly authorized officer
of the Company. If the Company determines that you are a “specified employee”
under Section 409A(a)(2)(B)(i) of the Internal Revenue Code of 1986, as
amended (the “Code”), when your employment terminates, then any payments
under this Agreement that are not exempt from Section 409A of the Code will
commence on the earliest practicable date that occurs more than six months after
the termination of your employment.
14. Company
Property. You agree that on or prior to your last day
of service, you will return to the Company all property that belongs to the
Company, including (without limitation) copies of documents that belong to the
Company and files stored on your computer(s) that contain information belonging
to the Company, except that you may keep your personal copies of (i) your
compensation records and (ii) materials distributed to stockholders
generally.
15. No
Disparagement. You agree that you will never make any
negative or disparaging statements (orally or in writing) about the Company or
its stockholders, directors, officers, employees, products, services or business
practices, except as required by law.
16. Confidentiality of
Agreement. You acknowledge that this Agreement will be
filed publicly by the Company. Until the date of public filing, you
agree that you will not disclose to others the existence or terms of this
Agreement, except that you may disclose such information to your spouse,
attorney or tax adviser if such individuals agree that they will not disclose to
others the existence or terms of this Agreement.
17. Severability. If any term of this Agreement is held to be invalid,
void or unenforceable, the remainder of this Agreement will remain in full force
and effect and will in no way be affected, and the parties will use their best
efforts to find an alternate way to achieve the same
result.
18. Company’s
Successors. This Agreement shall be binding upon any successor
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company’s business and/or assets. For all purposes under this
Agreement, the term “Company” shall include any successor to the Company’s
business and/or assets which becomes bound by this Agreement.
19. Choice of Law. This
Agreement will be construed and interpreted in accordance with the laws of the
State of California (other than their choice-of-law provisions).
20. Execution. This
Agreement may be executed in counterparts, each of which will be considered an
original, but all of which together will constitute one
agreement. Execution of a facsimile copy will have the same force and
effect as execution of an original, and a facsimile signature will be deemed an
original and valid signature.
Please
indicate your agreement with the above terms by signing below.
Very
truly yours,
Equinix,
Inc.
By: /s/
I agree
to the terms of this Agreement, and I am voluntarily signing this release of all
claims. I acknowledge that I have read and understand this Agreement,
and I understand that I cannot pursue any of the claims and rights that I have
waived in this Agreement at any time in the future.
/s/
Signature
of Xxxxxxxx Xxxxxxx
| Dated: | July 22, 2008 |
Attachment
Exhibit A:
Form of Release
Exhibit B:
Proprietary Information and Inventions Agreement
EXHIBIT
A
GENERAL
RELEASE OF ALL CLAIMS
In
consideration of the benefits to be provided to Xxxxxxxx Xxxxxxx (“Employee”) by
Equinix, Inc. (“the Company”), pursuant to the Agreement between Employee and
the Company dated as of July __, 2008 (the “Agreement”), Employee, on Employee’s
own behalf and on behalf of Employee’s heirs, executors, administrators and
assigns, hereby fully and forever releases and discharges the Company and its
directors, officers, employees, agents, successors, predecessors, subsidiaries,
parent, shareholders, employee benefit plans and assigns (together called “the
Releasees”), from all known and unknown claims and causes of action including,
without limitation, any claims or causes of action arising out of or relating in
any way to Employee’s employment with the Company, including the termination of
that employment.
1. After
Employee signs this general release of all claims (“Release”), Employee will be
entitled to the additional benefits set forth in the Agreement that are
conditioned on this Release.
2. To the
fullest extent permitted by law, Employee waives, releases and promises never to
assert any claims or causes of action, whether or not now known, against the
Company or its predecessors, successors or past or present subsidiaries,
stockholders, directors, officers, employees, consultants, attorneys, agents,
assigns and employee benefit plans with respect to any matter, including
(without limitation) any matter related to her employment with the Company or
the termination of that employment, including (without limitation) claims to
attorneys’ fees or costs, claims of wrongful discharge, constructive discharge,
emotional distress, defamation, invasion of privacy, fraud, breach of contract
or breach of the covenant of good faith and fair dealing and any claims of
discrimination or harassment based on sex, age, race, national origin,
disability or any other basis under Title VII of the Civil Rights Act of
1964, the California Fair Employment and Housing Act, the Age Discrimination in
Employment Act of 1967, the Americans with Disabilities Act and all other laws
and regulations relating to employment. However, this release covers
only those claims that arose prior to the execution of this Agreement and only
those claims that may be waived by applicable law. Execution of this
Agreement does not bar any claim that arises hereafter, including (without
limitation) a claim for breach of this Agreement.
3. In
addition, Employee hereby expressly waives any and all rights and benefits
conferred upon Employee by the provisions of section 1542 of the Civil Code of the State of
California,
which states as follows:
A general
release does not extend to claims which the creditor does not know or suspect to
exist in his or her favor at the time of executing the release, which if known
by him or her must have materially affected his or her settlement with the
debtor.
4. Employee
also hereby agrees that nothing contained in this Release shall constitute or be
treated as an admission of liability or wrongdoing by the Releasees or
Employee.
5. Employee
represents that she has returned to the Company all property that belongs to the
Company, including (without limitation) copies of documents that belong to the
Company and files stored on her computer(s) that contain or embody business,
technical or financial information that she has developed, learned or obtained
during the term of her service to the Company that relate to the Company or the
business or demonstrably anticipated business of the Company, except that she
may keep her personal copies of (i) her compensation records and (ii) materials
distributed to stockholders generally.
6. If any
provision of this Release is found to be unenforceable, it shall not affect the
enforceability of the remaining provisions and the court shall enforce all
remaining provisions to the full extent permitted by law.
7. This
Release constitutes the entire agreement between Employee and Releasees with
regard to the subject matter of this Release. It supersedes any other
agreements, representations or understandings, whether oral or written and
whether express or implied, which relate to the subject matter of this Release
except as otherwise set forth in the Agreement.
8. This
Release is not to be signed, and will not become effective, prior to Employee’s
cessation of service. Employee acknowledges that (a) her waiver
and Release does not apply to any claims that may arise after she signs this
Release; (b) she should consult with an attorney before executing this
Release; (c) she has twenty-one (21) days from the date she first received
this Release in July 2008 within which to review the Release; (d) she has
seven (7) days following the execution of this Release to revoke this Release;
and (e) this Release shall not be effective until the eighth day after this
Release has been signed by Employee (the “Effective Date”). To revoke
this Release, Employee must notify the Vice President of Human Resources in
writing of her intent to revoke, and such written notification must be received
within seven (7) days of the date Employee signs this
Release. Employee shall not be entitled to receive any of the
consideration being provided in exchange for this Release until the Effective
Date.
9. Employee
states that before signing this Release, Employee:
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·
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Has
read it,
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·
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Understands
it,
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|
·
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Knows
that she is giving up important
rights,
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·
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Is
aware of her right to consult an attorney before signing it,
and
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·
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Has
signed it knowingly and
voluntarily.
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Date:
______________
Signature of Xxxxxxxx
Xxxxxxx
TO BE
SIGNED UPON CESSATION OF SERVICE
