XNYS:RAX Rackspace Hosting Inc Insider Activity 4 Filing - 2/15/2012

Effective Date 2/15/2012

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FORM 4
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
Napier A Lanham
  2. Issuer Name and Ticker or Trading Symbol
RACKSPACE HOSTING, INC. [RAX]
5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
__X__ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
CEO and President
(Last)
(First)
(Middle)
C/O RACKSPACE HOSTING, INC., 5000 WALZEM ROAD
3. Date of Earliest Transaction (Month/Day/Year)
02/15/2012
(Street)

SAN ANTONIO, TX 78218
4. If Amendment, Date Original Filed (Month/Day/Year)
6. Individual or Joint/Group Filing (Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)
2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code
(Instr. 8)
4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)
5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)
6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)
7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price
Common Stock 02/15/2012   A   8,083(1)(2) A $ 0 431,035 D  
Common Stock 02/15/2012   M   423,278 A $2.5 854,313 D  
Common Stock 02/15/2012   S   423,278(4) D $54.5925(5)(6) 431,035 D  
Common Stock               3,687,830 I Shares held by HBSA, LP.(7)
Common Stock               37,492 I Held in trust for the benefit of Mr. Napier's children.

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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)
2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code
(Instr. 8)
5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)
6. Date Exercisable and Expiration Date
(Month/Day/Year)
7. Title and Amount of Underlying Securities
(Instr. 3 and 4)
8. Price of Derivative Security
(Instr. 5)
9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)
10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)
11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Employee Stock (Option Right to Buy) $54.12 02/15/2012   A   16,957(2)     (3) 02/15/2019 Common Stock 16,957 $ 0 16,957 D  
Employee Stock (Option Right to Buy) $2.5 02/15/2012   A   423,278(2)   12/12/2009 12/31/2015 Common Stock 423,278 $ 0 1,159,732 D  

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
Napier A Lanham
C/O RACKSPACE HOSTING, INC.
5000 WALZEM ROAD
SAN ANTONIO, TX 78218
  X     CEO and President  

Signatures

 /s/ William Alberts by Power of Attorney   02/17/2012
** Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) These shares were granted in the form of Restricted Stock Awards (RSA's). 1/4 of the shares under the RSA award shall vest and become unrestricted on each anniversary date of the grant date of February 15, 2012.
(2) Granted pursuant to the Rackspace Hosting, Inc. 2007 Long Term Incentive Plan.
(3) 1/4 of the options vest annually beginning on the grant date of February 15, 2012.
(4) These shares were sold pursuant to Mr. Napier's Rule 10b5-1 trading plan adopted by Mr. Napier on December 14, 2009.
(5) The prices for these sales of shares ranged from $53.84 to $55.60 per share.
(6) The registrant undertakes to provide, upon request by the SEC staff, the issuer, or a security holder of the issuer, full information regarding the number of shares purchased or sold at each separate price.
(7) Mr. Napier is the managing general partner and a limited partner of HBSA, LP, a limited partnership. Mr. Napier disclaims any beneficial ownership of shares held by HBSA, LP except to the extent of any pecuniary interest therein.

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XNYS:RAX Rackspace Hosting Inc Insider Activity 4 Filling

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XNYS:RAX Rackspace Hosting Inc Insider Activity 4 Filing - 2/15/2012
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