Common use of Payments and Other Considerations Clause in Contracts

Payments and Other Considerations. a. In consideration of the Release being given by Employee hereunder, Rackspace agrees to pay to Employee the sum of Two Hundred Forty Thousand and 00/100 Dollars, payable in twenty six (26) bi-weekly installments of $9230.77 each, less required withholding amounts, in accordance with the Company’s regular payroll procedures, commencing the first payroll period after the date hereof. b. As further consideration for this Agreement, Rackspace agrees that Employee will have the right to retain 25,000 Vested Options issued pursuant to the Macro Holding, Inc. Stock Option Agreement, dated March 20, 2006, and Employee will have the right to exercise these 25,000 Vested Options in accordance with said stock option agreement until September 30, 2008, and Employee’s right to exercise said 25,000 Vested Options shall not terminate as a result of him not being a Service Provider until September 30, 2008. All other non-vested options under the March 20, 2006 Macro Holding, Inc. Stock Option Agreement shall terminate as of the date hereof. The March 20, 2006 Holding, Inc. Stock Option Agreement is hereby amended to incorporate the foregoing agreement. c. Additionally, Rackspace will pay to Employee his base pay rate for 92.62 hours ETO balance. d. On or before August 1, 2007, Employee will be paid a full Q2 2007 EVA bonus, plus the “bank” amount of $2,437. Employee acknowledges and agrees that such bonus is accepted by Employee as, and is to be considered as, payments for the release granted hereby and in lieu of notice for unemployment compensation purposes. In addition, Rackspace will pay Employee all reasonable unreimbursed expenses in accordance with company policy. e. Rackspace will allow Employee to keep his cell phone, and his cell phone number, for use on Employee’s personal cell phone plan. Rackspace will facilitate this by agreeing to port the number to Employee’s cell phone provider. In addition, Rackspace will forward email to Employee for a period of six months or until otherwise notified by Employee. In addition, Rackspace will not re-assign Employee’s direct dial phone number for a period of six months, and will cause the phone number to roll over to ▇▇▇▇▇ ▇▇▇ or her successor, who will be instructed to forward messages to Employee. f. If Employee is or was made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “proceeding”) by reason of the fact that he was an officer of the Company or, while an officer of the Company, was serving at the request of the Company as an officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan, whether the basis of such proceeding is alleged action in an official capacity as an officer, employee or agent, or in any other capacity while serving as an officer, employee or agent, then Employee shall be indemnified and held harmless by the Company to the fullest extent authorized or permitted by applicable law, as the same exists or may hereafter be amended, against all expense, liability and loss (including, without limitation, attorneys’ fees, judgments, fines, ERISA excise taxes and penalties and amounts paid in settlement) reasonably incurred or suffered by Employee in connection with such proceeding, and such right to indemnification shall continue notwithstanding that Employee has ceased to be an officer, employee or agent and shall inure to the benefit of his heirs, executors and administrators; provided, however, that, except for proceedings to enforce rights to indemnification, the Company shall indemnify Employee in connection with a proceeding (or part thereof) initiated by Employee only if such proceeding (or part thereof) was authorized by the Company’s Board of Directors. g. Rackspace shall not be obligated to make any further or additional payment to Employee in any amount or for any purpose whatsoever.

Payments and Other Considerations. a. In consideration of the Release being given by Employee hereunder, Rackspace agrees to pay to Employee the sum of Two Hundred Forty Thousand $151,667 as severance and 00/100 Dollars, payable in twenty six $10,739.96 for unused earned time off (26) bi-weekly installments of $9230.77 each, less required withholding amounts, in accordance with the Company’s regular payroll procedures, commencing the first payroll period ETO). These payments will be made within thirty days after the date hereof. b. As further consideration for this Agreement, Rackspace agrees that Employee will have the right to retain 25,000 93,750 Vested Options issued pursuant to the Macro HoldingRackspace, Inc. Stock Option Agreement, dated March 20with a Date of Grant of October 1, 20062007, and Employee will have the right to exercise these 25,000 93,750 Vested Options in accordance with said stock option agreement until September April 30, 20082009, and Employee’s right to exercise said 25,000 93,750 Vested Options shall not terminate as a result of him not being a Service Provider until September April 30, 20082009. All other non-vested options under the March 20October 1, 2006 Macro Holding, 2007 Rackspace Inc. Stock Option Agreement shall terminate as of the date hereof. The March 20October 1, 2006 Holding, 2007 Rackspace Inc. Stock Option Agreement is hereby amended to incorporate the foregoing agreement. c. Additionally, Rackspace will pay to Employee his base pay rate for 92.62 hours ETO balance. d. On or before August 1, 2007, Employee will be paid a full Q2 2007 EVA bonus, plus the “bank” amount of $2,437. Employee acknowledges and agrees that such bonus is the payments to be made hereunder shall be accepted by Employee as, and is to shall be considered as, payments for the release releases granted hereby hereby, and in lieu of notice for unemployment compensation purposes. In addition, Rackspace will pay Employee all reasonable unreimbursed expenses in accordance with company policy. e. d. Rackspace will allow Employee to keep his cell phone, and his cell phone number, for use on Employee’s personal cell phone plan. Rackspace will facilitate this by agreeing to port the number to Employee’s cell phone provider. In addition, Rackspace will forward email to Employee for a period of six months or until otherwise notified by Employee. In addition, Rackspace will not re-assign Employee’s direct dial phone number for a period of six months, and will cause the phone number to roll over to ▇▇▇▇▇ ▇▇▇ or her successor, who will be instructed to forward messages to Employee. f. If Employee is or was made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “proceeding”) by reason of the fact that he was an officer of the Company or, while an officer of the Company, was serving at the request of the Company as an officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan, whether the basis of such proceeding is alleged action in an official capacity as an officer, employee or agent, or in any other capacity while serving as an officer, employee or agent, then Employee shall be indemnified and held harmless by the Company to the fullest extent authorized or permitted by applicable law, as the same exists or may hereafter be amended, against all expense, liability and loss (including, without limitation, attorneys’ fees, judgments, fines, ERISA excise taxes and penalties and amounts paid in settlement) reasonably incurred or suffered by Employee in connection with such proceeding, and such right to indemnification shall continue notwithstanding that Employee has ceased to be an officer, employee or agent and shall inure to the benefit of his heirs, executors and administrators; provided, however, that, except for proceedings to enforce rights to indemnification, the Company shall indemnify Employee in connection with a proceeding (or part thereof) initiated by Employee only if such proceeding (or part thereof) was authorized by the Company’s Board of Directors. g. e. Rackspace shall not be obligated to make any further or additional payment to Employee in any amount or for any purpose whatsoever.