PEAPOD INC
EXECUTIVE EMPLOYMENT AGREEMENT
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<TYPE>EX-10.37
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<FILENAME>a2043710zex-10_37.txt
<DESCRIPTION>EXECUTIVE EMPLOYMENT AGREEMENT
<TEXT>

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                                                               EXHIBIT 10-37

                         EXECUTIVE EMPLOYMENT AGREEMENT


         EXECUTIVE EMPLOYMENT AGREEMENT (the "AGREEMENT") dated as of May 1,
2000 between Marc van Gelder (the "EXECUTIVE") and Peapod, Inc., a Delaware
corporation (the "COMPANY").

         WHEREAS, the Company desires to employ the Executive as its President
and Chief Executive Officer, and the Executive desires to accept such
employment, for the term and upon the other conditions hereinafter set forth;
and

         WHEREAS, the Executive and the Company are concurrently entering into a
Severance Agreement (the "SEVERANCE AGREEMENT") providing for certain severance
benefits.

         NOW, THEREFORE, in consideration of the agreements and covenants
contained herein, the Executive and the Company hereby agree as follows.



                                    ARTICLE I
                                   EMPLOYMENT


         SECTION 1.01. POSITION AND RESPONSIBILITIES. The Company shall employ
the Executive as its President and Chief Executive Officer. Subject to the
authority and supervision of the Company's Board of Directors (including any
committees thereof, the "Board"), the Executive shall have full responsibility
and authority over the business and affairs of the Company. The Executive shall
report to the Board and shall perform such other executive and administrative
duties (not inconsistent with the position of President and Chief Executive
Officer) as may from time to time be authorized or directed by the Board. The
Executive agrees to be employed by the Company in such capacity, subject to all
the covenants and conditions hereinafter set forth.

         SECTION 1.02. PERFORMANCE. During the term of Executive's employment,
the Executive shall perform faithfully the duties assigned to the Executive
hereunder to the best of his abilities and devote his full business time and
attention to the transaction of the Company's business and not engage in any
other business activity except with the approval of the Board. The previous
sentence shall not preclude the Executive from participating in the affairs of
any governmental, educational or other charitable institution so long as the
Board does not determine in good faith that such activities unreasonably
interfere with the business of the Company or the performance of the Executive's
duties hereunder.


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         SECTION 1.03. TERM AND TERMINATION. Employment under this Agreement
shall commence as of May 1, 2000 (the "COMMENCEMENT DATE") and shall continue
until terminated by written notice by either party, subject to the rights and
obligations set forth in the Severance Agreement.



                                   ARTICLE II
                                  COMPENSATION


         SECTION 2.01. BASE COMPENSATION. As compensation for his services
hereunder, the Company shall pay to the Executive a minimum annual salary of
$250,000 (the "BASE SALARY"), less required or authorized deductions, payable in
installments in accordance with the Company's normal payment schedule for senior
management of the Company. The Executive's salary shall be reviewed in February
of 2001, and at least annually thereafter, for adjustment above the Base Salary
required by this Section 2.01.

         SECTION 2.02. INCENTIVE OPTIONS. The Executive shall receive an option
to purchase 250,000 shares of Company common stock ("OPTION") at $3.75 per share
as of May 1, 2000 ("OPTION GRANT DATE"). The Option shall become exercisable
with respect to 25% of such shares on the first anniversary of the Option Grant
Date and with respect to an additional 1/48 of such shares on the last day of
each month thereafter. The Options shall be exercisable for a period of eight
years from the Option Grant Date. The Options shall be subject to the terms of a
Stock Option Agreement ("OPTION AGREEMENT") entered into by the parties
concurrently herewith. The Executive may receive further grants under such
Company stock incentive programs as may exist from time to time as determined in
the absolute discretion of the Board.

         SECTION 2.03. BONUS PLAN. The Executive shall be entitled to
participate in the Company's Executive Bonus Plan as modified by the Board from
time to time. Such plan shall provide for an opportunity for the Executive to
earn an annual cash bonus of up to 75% of Executive's Base Salary received for
the year as to which such bonus is earned, based on meeting such individual and
Company performance goals as may be set from time to time by the Board in its
absolute discretion. The Executive's maximum percentage bonus of 75% is not
subject to reduction without the Executive's written consent. For calender year
2000, the Company guarantees that the Executive's cash bonus will be at least
equal to the cash bonus he would have received had he remained employed at Stop
and Shop Supermarket Company, Inc. ("STOP AND SHOP"), LESS the appreciation,


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if any, in the value of the Executive's Option (determined by multiplying the
number of shares covered by the Option by the amount by which the average
closing price of a share of Company common stock on the NASDAQ National
Market System for the last five trading days in calendar year 2000 exceeds
$3.75 per share).

         SECTION 2.04. EMPLOYEE BENEFITS. Upon satisfaction of any eligibility
requirements, the Executive shall be entitled to participate in such employee
benefit plans and to receive such other fringe benefits during Executive's term
of employment as are from time to time made generally available to the senior
management of the Company; PROVIDED that, if a severance benefit is payable to
the Executive pursuant to Section 2.06, such benefit shall be paid in lieu of
any benefit otherwise payable to Executive pursuant to any Company severance
plan unless such plan expressly provides that payments thereunder will be made
in addition to the severance payments provided hereunder. As of the date hereof,
such plans include a 401 (k) plan, health insurance plan, life insurance program
and long term disability plan. The Executive's benefits shall also include the
following specific benefits:

         a.       four weeks paid vacation per year to be taken in accordance
                  with and subject to Company vacation policy (the Company will
                  be credited with any vacation days taken by the Executive
                  during calender year 2000 while employed at Stop and Shop.);

         2.       cash reimbursement of the benefit premiums paid by the
                  Executive under COBRA to continue coverage under Stop and
                  Shop's health plan until the Executive satisfies Company
                  benefit eligibility requirements;

         3.       cash reimbursement of amount paid by the Executive to purchase
                  the leased vehicle presently used by the Executive (Executive
                  shall own the vehicle and pay all maintenance, insurance and
                  fuel costs);

         4.       life insurance benefits equal to the Executive's Base Salary,
                  as adjusted, payable to the Executive's designated
                  beneficiary;

         5.       payment through May 23, 2002 of the premium on the $1.5
                  million term life insurance policy currently covering the
                  Executive at Stop and Shop;

         6.       short term and long term disability insurance benefits equal
                  to 60% of the Executive's Base Salary, as adjusted; and

         7.       cash reimbursement of the Executive's relocation expenses
                  based on Ahold USA Relocation Policy including: (i) grossed up
                  reimbursement of any non-tax deductible expenses and (ii) lump
                  sum payment of $5,000 to offset any miscellaneous expenses.


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         8.       directors and officers liability insurance with coverage to
                  the same extent provided other executive officers and
                  directors of the Company.

Nothing herein shall be construed to require the Company to establish, or shall
preclude the Company, in its absolute discretion, from changing or amending, in
whole or in part, or revoking, any one or more of Company employee benefit plans
or programs without notice, PROVIDED that the benefits enumerated in
subparagraphs a through h of this Section shall not be changed or amended unless
replaced by substantially equivalent benefits.

         SECTION 2.05. EXPENSE REIMBURSEMENTS. The Company shall reimburse the
Executive for all proper expenses incurred by Executive in the performance of
Executive's duties hereunder in accordance with the policies and procedures
established by the Board.

         SECTION 2.06. SEVERANCE BENEFITS. Concurrently herewith, the Executive
and Peapod are entering into the Severance Agreement which provides certain
severance benefits for the Executive in the event of termination of Executive's
employment with the Company. The Executive shall be entitled to the benefits of
such Severance Agreement as if the provisions thereof were set forth fully
herein.



                                   ARTICLE III
                    NONCOMPETITION; CONFIDENTIAL INFORMATION


         SECTION 3.01. NONCOMPETITION; NON-SOLICITATION. As a condition to
Executive's employment and to the Company's obligations hereunder, Executive
agrees to enter into, concurrently with Executive's execution of this Agreement,
an Employee Nonsolicitation and Noncompete Agreement in the form attached hereto
as EXHIBIT A, and the Executive agrees to comply fully with all of the terms and
provisions of such Employee Nonsolicitation and Noncompete Agreement as if such
terms and provisions were fully set forth in this Agreement. The covenants
contained in such Employee Nonsolicitation and Noncompete Agreement shall
survive the termination of this Agreement and the conclusion of the Executive's
employment by the Company.


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                                   ARTICLE IV
                                  MISCELLANEOUS


         SECTION 4.01. NOTICES. All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given when delivered or three (3) days after deposit in the United States mail,
certified and return receipt requested, postage prepaid, addressed (1) if to the
Executive, to the Executive's address shown on the Company records, and if to
the Company, to Peapod, Inc., 9933 Woods Drive, Skokie, Illinois 60077-1031,
attention Chairman of the Board with a copy to the Secretary, or (2) to such
other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective
only upon receipt.

         SECTION 4.02. EXECUTIVE'S AUTHORITY; NO CONFLICT. The Executive
represents and warrants to the Company that the Executive has full right and
authority to execute and deliver this Agreement and to comply with the terms and
provisions hereof and that the execution and delivery of this Agreement and
compliance with the terms and provisions hereof by the Executive will not
conflict with or result in a breach of the terms, conditions or provisions of
any agreement, restriction or obligation by which the Executive is bound.

         SECTION 4.03. ASSIGNMENT AND SUCCESSION. The Agreement shall be binding
upon and shall operate for the benefit of the parties hereto and their
respective legal representatives, legatees, distributees, heirs, and successors
and assigns. Executive acknowledges that the services he renders pursuant to
this Agreement are unique and personal. Accordingly, Executive may not assign
any of the Executive's rights contained in this Agreement or delegate any of his
duties hereunder. The Company may assign the Company's rights, duties or
obligations under this Agreement to a purchaser or transferee of all or
substantially all of the Company's assets.

         SECTION 4.04. HEADINGS. The Article, Section paragraph and subparagraph
headings are for convenience of reference only and shall not define or limit the
provisions hereof.

         SECTION 4.05. APPLICABLE LAW. This Agreement shall at all times be
governed by and construed, interpreted and enforced in accordance with the
internal laws (as opposed to conflict of laws provisions) of the State of
Illinois.

         SECTION 4.06. SEVERABILITY. Whenever possible, each provision of this
Agreement will be


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interpreted in such manner as to be effective and valid under applicable law.
In the event that any provision of this Agreement shall be held to be void or
unenforceable, the remaining provisions of this Agreement shall continue in
full force and effect.

         SECTION 4.07. WAIVER, ETC. The waiver of a breach of any provision of
this Agreement shall not operate or be construed to be a waiver of any other
breach. No delay or omission in the exercise of any power, remedy, or right
herein provided or otherwise available to any party shall impair or affect the
right of such party thereafter to exercise the same. Any extension of time or
other indulgence granted to a party hereunder or to any other person shall not
otherwise alter or affect any power, remedy or right of any other party, or
obligations of the party to whom such extension or indulgence is granted except
as specifically waived.

         SECTION 4.08. DISPUTE RESOLUTION. Any controversy or claim arising out
of or relating to this Agreement, or the breach thereof, shall be settled by
arbitration administered by the American Arbitration Association ("AAA") in
accordance with its rules, to the extent not inconsistent with this provision.
Judgment upon the award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. Such arbitration shall be conducted in Chicago,
Illinois before a single arbitrator. The parties shall select an arbitrator by
mutual agreement from a panel of arbitrators experienced in arbitrating
employment disputes proposed by the AAA. If the paries are unable to agree on an
arbitrator, the AAA shall select an arbitrator in accordance with its
procedures. Nothing herein shall preclude the Company from seeking and/or
obtaining injunctive relief under the Employee Nonsolicitation and Noncompete
Agreement.

         SECTION 4.09. ENTIRE AGREEMENT. This Agreement, together with the
agreements referred to herein, contain the entire agreement of the parties
relating to the subject matter hereof. This Agreement may be modified or
discharged only by an agreement in writing signed by the party against whom
enforcement of any modification or discharge is sought.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.



                             PEAPOD, INC.



                             By: /s/ ANDREW B. PARKINSON
                                 ----------------------------------
                                 Andrew B. Parkinson
                                 Chairman of the Board


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                             EXECUTIVE:


                             /S/ MARC VAN GELDER
                             --------------------------------------
                             Marc van Gelder








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