<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. __)
(Mark One)
[X] Filed by the Registrant
[ ] Filed by a Party other than the Registrant
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 240.14a-11(c) or Rule
240.14a-12
USINTERNETWORKING, INC.
(Name of Registrant as Specified In Its Charter)
NOT APPLICABLE
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)
(4) and 0-11
TITLE OF EACH CLASS OF SECURITIES TO WHICH TRANSACTION
APPLIES:_______________________.
AGGREGATE NUMBER OF SECURITIES TO WHICH TRANSACTION
APPLIES:_______________________.
PER UNIT PRICE OR OTHER UNDERLYING VALUE OF TRANSACTION
COMPUTED PURSUANT TO EXCHANGE ACT RULE 0-11:_______________.
(Set forth the amount on which the filing fee is calculated
and state how it was determined.)
PROPOSED MAXIMUM AGGREGATE VALUE OF TRANSACTION:___________.
TOTAL FEE PAID:____________________.
[ ] Fee paid previously with preliminary materials
[ ] Check box if any part of the fee is offset as provided by
Exchange Act
Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the
previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
AMOUNT PREVIOUSLY PAID:________________________.
FORM, SCHEDULE OR REGISTRATION STATEMENT NO.:____________.
FILING PARTY:____________________.
DATE FILED:______________________.
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<PAGE>
[LOGO OF USINTERNETWORKING, INC. APPEARS HERE]
USINTERNETWORKING, INC.
One USI Plaza
Annapolis, Maryland 21401-7478
January 4, 2000
Dear Stockholder:
You are cordially invited to attend a Special Meeting of Stockholders
of USINTERNETWORKING, INC. (the "Company"), to be held at One USI Plaza,
Annapolis, Maryland, on January 14, 2000, at 9:00 a.m.
At the Special Meeting you will be asked to vote to increase the
authorized number of shares of the Company's Common Stock from 75,000,000 to
450,000,000. The proposed increase is intended to ensure that an adequate number
of authorized shares of Common Stock will be available to the Company, if and
when needed, for any lawful purpose.
The Company's Board of Directors has approved the proposed amendment to
the Company's Second Amended and Restated Certificate of Incorporation to
increase the number of shares of Common Stock and recommends that you vote FOR
the approval of such proposal.
The accompanying material contains the Notice of Special Meeting, the
Proxy Statement, which includes information about the matter to be acted upon at
the Special Meeting, and the related proxy card.
It is important that your shares be represented at the meeting, whether
or not you attend the Special Meeting in person. I urge you to sign and date the
enclosed proxy card and return it promptly in the enclosed envelope.
Very truly yours,
USINTERNETWORKING, INC.
/s/ Christopher R. McCleary
Christopher R. McCleary
Chairman of the Board and Chief
Executive Officer
<PAGE>
[LOGO OF USINTERNETWORKING, INC. APPEARS HERE]
USINTERNETWORKING, INC.
One USI Plaza
Annapolis, Maryland 21401-7478
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To be held January 14, 2000
To the Stockholders of
USINTERNETWORKING, INC.
Notice is hereby given that a Special Meeting of Stockholders (the
"Special Meeting") of USINTERNETWORKING, INC. (the "Company") will be held at
One USI Plaza, Annapolis, Maryland, on January 14, 2000 at 9:00 a.m. for the
following purposes:
1. To approve an amendment to the Company's Second Amended and Restated
Certificate of Incorporation to increase the authorized number of shares of
Common Stock from 75,000,000 to 450,000,000; and
2. To transact such other business as may properly come before the
meeting or any adjournments or postponements thereof.
The foregoing items of business are more fully described in the attached Proxy
Statement.
Only stockholders of record at the close of business on December 28,
1999 are entitled to notice of, and to vote at, the Special Meeting and at any
adjournments or postponements thereof. A list of such stockholders will be
available for inspection at the Company's headquarters located at One USI Plaza,
Annapolis, Maryland, during ordinary business hours for the ten-day period prior
to the Special Meeting.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ Christopher R. McCleary
Christopher R. McCleary
Chairman of the Board
and Chief Executive Officer
Annapolis, Maryland
January 4, 2000
IMPORTANT
WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, SIGN,
DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE-PAID
ENVELOPE. YOU MAY REVOKE YOUR PROXY AT ANY TIME PRIOR TO THE SPECIAL MEETING. IF
YOU DECIDE TO ATTEND THE SPECIAL MEETING AND WISH TO CHANGE YOUR PROXY VOTE, YOU
MAY DO SO AUTOMATICALLY BY VOTING IN PERSON AT THE MEETING.
<PAGE>
USINTERNETWORKING, INC
One USI Plaza
Annapolis, Maryland 21401-7478
PROXY STATEMENT
FOR SPECIAL MEETING OF STOCKHOLDERS
To be held January 14, 2000
These proxy materials are furnished in connection with the solicitation
of proxies by the Board of Directors of USINTERNETWORKING, INC., a Delaware
corporation (the "Company"), for a Special Meeting of Stockholders (the "Special
Meeting") to be held at the Company's principal executive offices located at One
USI Plaza, Annapolis, Maryland, on January 14, 2000, at 9:00 a.m., and at any
adjournment or postponement of the Special Meeting. By executing and returning
the enclosed proxy, you authorize the persons named therein to represent you and
vote your shares at the Special Meeting, and at any adjournments or
postponements thereof, in accordance with your instructions. Those persons may
also vote your shares to adjourn or postpone the Special Meeting from time to
time. A proxy may be revoked at any time before it is voted by voting in person
at the Special Meeting, by the execution and delivery of a revised proxy bearing
a later date, or by a written notice of revocation sent to the Secretary of the
Company at the address set forth above that is received prior to the Special
Meeting.
These proxy materials were first mailed to the Company's stockholders
on or about January 4 1999.
All share numbers provided in this Proxy Statement have been adjusted
to reflect the 3-for-2 stock split of the Company's Common Stock effected by
means of a stock dividend which was distributed on December 17, 1999.
PURPOSE OF MEETING
The purpose of the Special Meeting and the specific proposal to be
considered and acted upon at the Special Meeting is summarized in the
accompanying Notice of Special Meeting of Stockholders. The proposal is
described in more detail in this Proxy Statement.
VOTING RIGHTS AND SOLICITATION OF PROXIES
The Company's Common Stock is the only type of security entitled to
vote at the Special Meeting. On December 28, 1999, the record date for
determination of stockholders entitled to vote at the Special Meeting, there
were 61,162,176 shares of Common Stock outstanding. Each stockholder of record
on December 28, 1999 is entitled to one vote for each share of Common Stock held
by such stockholder on December 28, 1999. Shares of Common Stock may not be
voted cumulatively. All votes will be tabulated by the inspector of election
appointed for the meeting, who will separately tabulate affirmative and negative
votes, abstentions and broker non-votes.
QUORUM REQUIRED
The Company's bylaws provide that the holders of a majority of the
Company's Common Stock issued and outstanding and entitled to vote at the
Special Meeting, present in person or represented by proxy, shall constitute a
quorum for the transaction of business at the Special Meeting. Abstentions and
broker non-votes will be counted as present for the purpose of determining the
presence of a quorum.
VOTES REQUIRED
Approval of an amendment to the Company's Second Amended and Restated
Certificate of Incorporation to increase the authorized number of shares of
Common Stock from 75,000,000 to 450,000,000 requires the affirmative vote of a
majority of the Company's Common Stock issued and outstanding and entitled to
vote at the Special Meeting.
PROXIES
Whether or not you are able to attend the Company's Special Meeting,
you are urged to complete and return the enclosed
<PAGE>
proxy, which is solicited by the Company's Board of Directors and which will be
voted as you direct on your proxy when properly completed. IN THE EVENT NO
DIRECTIONS ARE SPECIFIED, SUCH PROXIES WILL BE VOTED FOR THE PROPOSAL AND IN THE
DISCRETION OF THE PROXY HOLDERS AS TO OTHER MATTERS THAT MAY PROPERLY COME
BEFORE THE SPECIAL MEETING. You may also revoke or change your proxy at any time
before the Special Meeting. To do this, send a written notice of revocation or
another signed proxy with a later date to the Secretary of the Company at the
Company's principal executive offices before the beginning of the Special
Meeting. You may also automatically revoke your proxy by attending the Special
Meeting and voting in person. All shares represented by a valid proxy received
prior to the Special Meeting will be voted.
SOLICITATION OF PROXIES
The Company will bear the entire cost of solicitation, including the
preparation, assembly, printing, and mailing of this Proxy Statement, the proxy,
and any additional soliciting material furnished to stockholders. Copies of
solicitation material will be furnished to brokerage houses, fiduciaries, and
custodians holding shares in their names that are beneficially owned by others
so that they may forward this solicitation material to such beneficial owners.
Proxies may be solicited by directors and regular officers and employees of the
Company by means of a personal interview, telephone or telegram.
PRINCIPAL STOCKHOLDERS
The table below sets forth, as of November 30, 1999, information with respect to
the beneficial ownership of our common stock by (1) each person who we know to
be the beneficial owner of more than 5% of our outstanding common stock; (2)
each of the directors and our Chief Executive Officer and each of the other
executive officers of USI who earned more than $100,000, in salary and bonus,
for all services rendered in all capacities during the fiscal year ended
December 31, 1998 (the "Named Executive Officers") individually; and (3) all
directors and executive officers as a group. Except as otherwise indicated, each
of the stockholders has sole voting and investment power with respect to the
shares beneficially owned. The address of each executive officer and director is
c/o USINTERNETWORKING, INC., One USI Plaza, Annapolis, MD 21401-7478.
<TABLE>
<CAPTION>
NAMED EXECUTIVE OFFICERS NUMBER OF SHARES PERCENTAGE OF
AND DIRECTORS BENEFICIALLY OWNED(1)(2) OWNERSHIP(1)(2)
-------------- ------------------------ -----------------
<S> <C> <C>
EXECUTIVE OFFICERS
Christopher R. McCleary(3)....................................... 2,508,927 4.11%
Stephen E. McManus............................................... 750,000 1.23
Jeffery L. McKnight(4)........................................... 562,500 *
DIRECTORS
R. Dean Meiszer(5)............................................... 712,096 1.17
Ray A. Rothrock(6)............................................... 4,016,961 6.56
Frank A. Adams(7)................................................ 12,529,102 20.31
William F. Earthman(8)........................................... 2,124,639 3.48
John H. Wyant(9)................................................. 5,725,528 9.33
Benjamin Diesbach(10)............................................ 11,250 *
David J. Poulin(11).............................................. 11,250 *
Michael C. Brooks(12)............................................ 8,934,196 14.64
Joseph Zell(13).................................................. 0 *
Cathy M. Brienza(14)............................................. 2,237,764 3.67
All Executive Officers and Directors as a group (16 persons)..... 41,690,213 68.00
BENEFICIAL OWNERS OF 5% OR MORE OF THE
OUTSTANDING COMMON STOCK OF USI
Blue Chip Group(15).............................................. 5,714,278 9.31
c/o Blue Chip Venture Company, Ltd.
2000 PNC Center
201 East Fifth Street
Cincinnati, Ohio 45202
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
Grotech Capital Group(16)........................................ 12,517,852 20.30%
9690 Deereco Road, Suite 800
Timonium, Maryland 21093
Venrock Group(17)................................................ 4,005,711 6.54
c/o Venrock Associates
Room 5506
30 Rockefeller Plaza
New York, New York 10112
Whitney Group(18)................................................ 8,928,571 14.63
c/o J.H. Whitney & Co.
177 Broad Street
Stamford, CT 06901
U S WEST Communications, Inc.(19)................................ 4,788,918 7.83
1801 California Street
Denver, Colorado 80202
</TABLE>
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* Less than one percent.
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. Except where community property laws
apply or as indicated in the footnotes of this table, to our knowledge, each
stockholder identified in the table possesses sole voting and investment
power with respect to all shares of common stock shown as beneficially owned
by the stockholder. The number of shares beneficially owned by a person
includes shares of common stock subject to options and warrants held by that
person that are currently exercisable within 60 days of November 30, 1999.
Shares issuable pursuant to options and warrants are deemed outstanding for
computing the percentage ownership of the person holding the options and
warrants but are not deemed outstanding for the purposes of computing the
percentage ownership of any other person.
(2) For purposes of this table, the number of shares of common stock outstanding
is deemed to be 61,033,471. For purposes of calculating the percentage
beneficially owned by any person, shares of common stock issuable to such
person upon the exercise of any options or warrants exercisable within 60
days of November 30, 1999 are also assumed to be outstanding.
(3) Includes 446,427 shares of common stock held by The Christopher R. McCleary
Childrens' Trust I of which Christopher McCleary is grantor.
(4) Includes options to purchase 562,500 shares of common stock exercisable
within 60 days of November 30, 1999.
(5) Includes 678,346 shares of common stock owned by USI Partners, Ltd. Mr.
Meiszer is a general partner of USI Partners, Ltd. Mr. Meiszer disclaims
beneficial ownership in the common stock except to the extent of his general
partner interest in USI Partners, Ltd. Also includes options to purchase
11,250 shares of common stock and warrants to purchase 22,250 shares of
common stock each exercisable within 60 days of November 30, 1999.
(6) Includes 1,648,437 shares of common stock owned by Venrock Associates and
2,159,596 shares of common stock owned by Venrock Associates II, L.P. Mr.
Rothrock is a general partner of Venrock Associates and Venrock Associates
II, L.P. and as such shares voting and investment power with other general
partners. Mr. Rothrock disclaims beneficial ownership in the common stock
except to the extent of his general partner interests in Venrock Associates
and Venrock Associates II, L.P. Also includes options to purchase 11,250
shares of common stock and warrants to purchase 197,677 shares of common
stock each exercisable within 60 days of November 30, 1999.
(7) Includes 4,151,785 shares of common stock owned by Grotech Partners IV, L.P.
and 7,723,212 shares of common stock owned by Grotech Partners V L.P. Mr.
Adams is a member of the general partner of Grotech Partners IV L.P. and
Grotech Partners V, L.P. and as such shares voting and investment power with
other members of the general partner. Mr. Adams disclaims beneficial
ownership of the shares owned by Grotech Partners IV L.P. and Grotech
Partners V L.P. Also includes options to purchase 11,250 shares of common
stock and warrants to purchase 642,855 shares of common stock each
exercisable within 60 days of November 30, 1999.
(8) Includes 1,124,998 shares of common stock owned by Southern Venture Fund
SBIC, L.P. and 964,284 shares of common stock owned by Southern Venture Fund
II, L.P. Mr. Earthman is a general partner of both Southern Venture Fund
SBIC, L.P. and Southern Venture Fund II, L.P. and as such shares voting and
investment power. Mr. Earthman disclaims beneficial ownership in the shares
owned by Southern Venture Fund
<PAGE>
SBIC, L.P. and Southern Venture Fund II, L.P., except to the extent of his
interests in the general partnerships of Southern Venture Fund SBIC, L.P.
and Southern Venture Fund II, L.P. Also includes options to purchase 11,250
shares of common stock and warrants to purchase 241,066 shares of common
stock each exercisable within 60 days of November 30, 1999. Southern
Venture Fund SBIC, L.P. and Southern Venture Fund II, L.P. are part of an
affiliated group of investment partnerships and are collectively referred
to as the Massey Burch Group.
(9) Includes 4,583,931 shares of common stock owned by Blue Chip Capital Fund II
Limited Partnership and 808,921 shares of common stock owned by Miami Valley
Venture Fund L.P. Mr. Wyant is the founder and president of Blue Chip
Venture Co., which manages both Blue Chip Capital Fund II Limited
Partnership and Miami Valley Venture Fund L.P. Mr. Wyant disclaims
beneficial ownership of the shares owned by Blue Chip Capital Fund II
Limited Partnership and Miami Valley Venture Fund L.P. Also includes options
to purchase 11,250 shares of common stock or warrants to purchase 321,426
shares of common stock each exercisable within 60 days of November 30, 1999.
(10) Includes options to purchase 11,250 shares of common stock exercisable
within 60 days of November 30, 1999.
(11) Includes options to purchase 11,250 shares of common stock exercisable
within 60 days of November 30, 1999.
(12) Includes 8,718,448 shares of common stock owned by J.H. Whitney III, L.P.
and 210,084 shares of common stock owned by Whitney Strategic Partners III,
L.P. Mr. Brooks is a general partner of J.H. Whitney & Co. and a Managing
Member of J.H. Whitney Equity Partners III, L.L.C. which is the general
partner of J.H. Whitney III, L.P. and Whitney Strategic Partners III, L.P.
Mr. Brooks disclaims beneficial ownership of the shares owned by J.H.
Whitney III, L.P and Whitney Strategic Partners III, L.P. Also includes
options to purchase 5,625 shares of common stock exercisable within 60 days
of November 30, 1999.
(13) Mr. Zell transferred options to purchase 11,250 shares of common stock
which he received under our option plan to U S WEST. U S WEST policy
prevents Mr. Zell from exercising these options for his own benefit.
(14) Includes 2,232,139 shares of common stock owned by Waller-Sutton Media
Partners, L.P. Ms. Brienza is a member of Waller-Sutton Media, L.L.C. the
general partner of Waller-Sutton Media Partners, L.P. Ms. Brienza disclaims
beneficial ownership of the shares held by Waller-Sutton Media Partners,
L.P. Also includes options to purchase 5,625 shares of common stock
exercisable within 60 days of November 30, 1999.
(15) Includes 4,583,931 shares of common stock owned by Blue Chip Capital Fund
II Limited Partnership and 808,921 shares of common stock owned by Miami
Valley Venture Fund, L.P. Blue Chip Capital Fund II Limited Partnership and
Miami Valley Venture Fund, L.P. are part of an affiliated group of
investment partnerships commonly controlled by Blue Chip Venture Company
and are collectively referred to as the Blue Chip Group. Also includes
warrants to purchase 321,426 shares of common stock exercisable within 60
days of November 30, 1999.
(16) Includes 4,151,758 shares of common stock owned by Grotech Partners IV,
L.P. and 5,148,808 shares of Common Stock owned by Grotech Partners V,
L.P.,Grotech Partners IV, L.P. and Grotech Partners V, L.P. are part of an
affiliated group of investment partnerships commonly controlled by Grotech
Capital Group and are collectively referred to as the Grotech Capital
Group. Also includes warrants to purchase 642,855 shares of common stock
exercisable within 60 days of November 30, 1999.
(17) Includes 1,648,437 shares of common stock owned by Venrock Associates and
2,159,596 shares of common stock owned by Venrock Associates II, L.P.,
Venrock Associates and Venrock Associates II, L.P. are affiliated entities
collectively referred to as the Venrock Group. Also includes warrants to
purchase 197,677 shares of common stock within 60 days of November 30,
1999.
(18) Includes 8,718,488 shares of common stock owned by J.H. Whitney III, L.P.
and 140,056 shares of common stock owned by Whitney Strategic Partners III,
L.P., J.H. Whitney III, L.P and Whitney Strategic Partners III, L.P. are
affiliated entities collectively referred to as the Whitney Group.
(19) Includes warrants to purchase 152,677 shares of common stock and options to
purchase 5,625 shares of common stock exercisable within 60 days of
November 30,1999.
<PAGE>
APPROVAL OF AMENDMENT TO THE COMPANY'S
SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
The present capital structure of the Company authorizes 75,000,000
shares of Common Stock. It also authorizes 1,000,000 shares of Preferred Stock,
which is presently undesignated and which may be issued from time to time in one
or more series with such rights, preferences and privileges as may be determined
by the Board of Directors. The Board of Directors believes that this capital
structure is inadequate for the future needs of the Company. Therefore, the
Board of Directors has approved the amendment of the Company's Second Amended
and Restated Certificate of Incorporation (the "Certificate") to increase the
authorized number of shares of Common Stock from 75,000,000 to 450,000,000
shares. No change is proposed to be made with respect to the number of
authorized shares of Preferred Stock. The Board of Directors believes that a
capital structure consisting of 450,000,000 authorized shares of Common Stock
and 1,000,000 authorized shares of Preferred Stock more appropriately reflects
the present and future needs of the Company and recommends such amendment to the
Company's stockholders for adoption. On December 28, 1999, 61,162,176 shares of
Common Stock and no shares of Preferred Stock were outstanding. The proposed
amendment of the Certificate was approved by the Board on December 21, 1999,
subject to stockholder approval at the Special Meeting.
PURPOSE OF AUTHORIZING ADDITIONAL COMMON STOCK
After reserving shares for issuance upon conversion of the Company's 7%
Convertible Subordinated Notes due 2004 issued in the fourth quarter of 1999 and
effecting the 3-for-2 stock split by means of a stock dividend completed by the
Company on December 17, 1999, the Company has what the Board of Directors
considers to be an insufficient number of authorized but unissued shares of
Common Stock available for future issue. Authorizing an additional 375,000,000
shares of Common Stock would give the Board of Directors the authority to issue
such Common Stock from time to time as the Board of Directors deems necessary,
without further action of the stockholders, unless such stockholder action is
specifically required by applicable laws or the rules of The Nasdaq National
Market or any stock exchange on which the Company's securities may then be
listed. The Board of Directors believes it is necessary to have the ability to
issue such additional shares of Common Stock for general corporate purposes,
including:
- stock splits, dividends or distributions;
- issuances under the Company's equity compensation plans-- the Board of
Directors recently approved an increase in the number of shares
available for issuance under the Company's 1998 Stock Option Plan and
an increase in the number of authorized shares is necessary to allow
grants under the plan;
- equity financings-- the Company may in the near term seek to raise
additional capital by selling and issuing shares of its Common Stock
as dictated by prevailing market conditions or the Company's capital
needs, and the Board of Directors believes it prudent to have shares
available for such issuances on an as-needed basis, without the delay
inherent in seeking stockholder approval for a specific transaction;
and
- acquisition transactions-- the Company may make future acquisitions
and may use its capital stock as currency in such acquisitions if
appropriate opportunities arise.
The Board of Directors has not irrevocably committed the Company to
issue shares of common stock for any of the foregoing purposes. However, the
Company, in consultation with its financial advisors, constantly monitors
conditions in the equity capital markets, and, assuming that the proposal to
increase the number of authorized shares of common stock is approved and that
the then prevailing market conditions are favorable, the Company may shortly
after the Special Meeting seek to raise additional capital through the issuance
of common stock. Furthermore, it is likely that the Company will in the ordinary
course of business continue to make grants under its 1998 Stock Option Plan.
Finally, the Company is also considering whether, in light of trading prices for
the Company's common stock, it would be appropriate in the near term to effect
an additional stock split by means of a stock dividend. Except as described
above, the Company has no plans or proposals with respect to issuances of the
additional shares of common stock that may be authorized at the Special Meeting.
The proposed increase in the authorized number of shares of Common
Stock could have a number of effects on the Company's stockholders depending
upon the exact nature and circumstances of any actual issuances of authorized
but unissued shares. The increase could have an anti-takeover effect, in that
additional shares could be issued (within the limits imposed by applicable law)
in one or more transactions that could make a change in control or takeover of
the Company more difficult. For example, additional shares could be issued by
the Company so as to dilute the stock ownership or voting rights of persons
seeking to obtain control of the Company. Similarly, the issuance of additional
shares to certain persons allied with the Company's management could have the
effect of making it more difficult to remove the Company's current management by
diluting the stock ownership or voting rights of persons
<PAGE>
seeking to cause such removal. The Board of Directors is not aware of any
attempt, or contemplated attempt, to acquire control of the Company, and this
proposal is not being presented with the intent that it be utilized as a type of
anti- takeover device.
Stockholders do not have any preemptive or similar rights to subscribe
for or purchase any additional shares of Common Stock that may be issued in the
future, and therefore, future issuances of Common Stock may, depending on the
circumstances, have a dilutive effect on the earnings per share, voting power
and other interests of the existing stockholders.
STOCKHOLDER APPROVAL
The affirmative vote of a majority of the Company's outstanding voting
shares is required for approval of the amendment to the Certificate. Abstentions
and broker non-votes will be counted towards the tabulation of votes cast on
this proposal and will have the same effect as negative votes. If this proposal
is approved at the Special Meeting, the proposed amendment would become
effective upon filing a certificate of amendment to the Certificate with the
Secretary of State of Delaware, which filing is expected to take place shortly
after such stockholder approval.
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors recommends a vote FOR this amendment to the
Certificate.
OTHER MATTERS
The Company is not aware of any business to be acted upon at the
Special Meeting other than that which is described in this Proxy Statement.
However, if other matters do properly come before the Special Meeting or any
adjournments or postponements thereof, the Board intends that the persons named
in the proxies will vote upon such matters in accordance with their best
judgment.
SUBMISSION OF STOCKHOLDER PROPOSALS
You may submit proposals for consideration at future stockholder
meetings, including director nominations. In order for a stockholder proposal to
be considered for inclusion in USINTERNETWORKING's proxy statement for next
year's annual meeting, the written proposal must be received by
USINTERNETWORKING no later than January 5, 2000. Any such proposal also will
need to comply with Securities and Exchange Commission regulations regarding the
inclusion of stockholder proposals in company-sponsored proxy materials.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ Christopher R. McCleary
Christopher R. McCleary
Chairman of the Board
and Chief Executive Officer
Annapolis, Maryland
January 4, 2000
WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, SIGN,
DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE-PAID
ENVELOPE. YOU MAY REVOKE YOUR PROXY AT ANY TIME PRIOR TO THE SPECIAL MEETING. IF
YOU DECIDE TO ATTEND THE SPECIAL MEETING AND WISH TO CHANGE YOUR PROXY VOTE, YOU
MAY DO SO AUTOMATICALLY BY VOTING IN PERSON AT THE MEETING. THANK YOU FOR YOUR
ATTENTION TO THIS MATTER.
<PAGE>
PROXY USINTERNETWORKING, INC. PROXY
One USI Plaza, Annapolis, Maryland, 21401-7478
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF USINTERNETWORKING, INC.
FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD JANUARY 14, 2000
This undersigned holder of Common Stock, par value $0.001, of
USINTERNETWORKING, INC. (the "Company") hereby appoints Christopher R. McCleary
and Harold C. Teubner, Jr. or either of them, proxies for the undersigned, each
with full power of substitution, to represent and to vote as specified in this
Proxy all Common Stock of the Company that the undersigned stockholder would be
entitled to vote if personally present at a Special Meeting of Stockholders (the
"Special Meeting") to be held on January 14, 2000 at 9:00 a.m. local time, at
the Company's principal executive offices located at One USI Plaza, Annapolis,
Maryland, and at any adjournments or postponements of the Special Meeting. The
undersigned stockholder hereby revokes any proxy or proxies heretofore executed
for such matters.
This proxy, when properly executed, will be voted in the manner as
directed herein by the undersigned stockholder. If no direction is made, this
proxy will be voted FOR the adoption of the proposal to amend the Second Amended
and Restated Certificate of Incorporation of the Company to increase the number
of authorized shares of Common Stock from 75 million shares to 450 million
shares and in the discretion of the proxies as to any other matters that may
properly come before the meeting. The undersigned stockholder may revoke this
proxy at any time before it is voted by delivering to the Corporate Secretary of
the Company either a written revocation of the proxy or a duly executed proxy
bearing a later date, or by appearing at the Special Meeting and voting in
person.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSED AMENDMENT TO THE
SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION.
PLEASE MARK, SIGN, DATE AND RETURN THIS CARD PROMPTLY USING THE ENCLOSED
RETURN ENVELOPE. If you receive more than one proxy card, please sign and return
ALL cards in the enclosed envelope.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
(Reverse)
USINTERNETWORKING, INC.
1. To approve the amendment to the Company's Second Amended and Restated
Certificate of Incorporation as set forth in the accompanying Proxy Statement.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Special Meeting.
The undersigned acknowledges receipt of the accompanying Notice of Special
Meeting of Stockholders and Proxy Statement.
<TABLE>
<S> <C> <C>
Signature: Signature (if held jointly): Date:
-------------------- --------------------- -----------------------
</TABLE>
Please date and sign exactly as your name(s) is (are) shown on the share
certificate(s) to which the Proxy applies. When shares are held as
joint-tenants, both should sign. When signing as an executor, administrator,
trustee, guardian, attorney-in-fact or other fiduciary, please give full title
as such. When signing as a corporation, please sign in full corporate name by
President or other authorized officer. When signing as a partnership, please
sign in partnership name by an authorized person.
