EXHIBIT 10.27
[LOGO] SEVERANCE AGREEMENT AND GENERAL
RELEASE
This Severance Agreement and General Release (collectively, the
"Agreement") is effective as of February 11, 2001, (the "Effective Date") by and
between ▇▇▇.▇▇▇ Inc., a Delaware corporation (the "Company"), and ▇▇▇▇ ▇▇▇▇▇▇▇
("Employee").
R E C I T A L S
A. Employee has been employed by the Company since March 1, 1999.
Circumstances, which have been discussed with Employee, currently
dictate that Employee and the Company end the employment relationship.
The Company does not have any severance policy which would entitle
Employee to any payment upon the termination of his employment. The
Company has decided, however, to offer a severance package to which
Employee would not otherwise be entitled, contingent upon Employee's
release of any and all claims, known or unknown, in favor of the
Company, as described below.
A G R E E M E N T
In consideration of the mutual covenants and agreements hereafter set
forth, the parties agree as follows:
1. Resignation of Position. Upon the Effective Date, Employee shall
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resign from his position as Chief Executive Officer and as the Chairman of the
Board of Directors, and all other positions with the Company and its
subsidiaries. Employees shall remain a Company employee through March 16, 2001.
During the employment term of this Agreement, Employee will provide employee
services to the Company as reasonably requested by the Company from time to
time. Employee will not render any services pursuant to this Agreement on
Company premises, unless specifically requested to so by the Company.
2. Terms of Separation. The Company agrees to provide Employee, upon
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receipt of the signed Agreement, and the expiration of any revocation period set
forth in Paragraph 5.C. below, the following compensation and benefits, provided
that Employee does not exercise any right to revocation contained herein:
▇. ▇▇▇▇▇▇▇▇▇ Payment. The Company shall pay to Employee his current
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salary, less applicable withholdings, from the Effective Date though March 16,
2001. The Company agrees to pay Employee a severance payment in an amount of
Three Hundred Twenty Three Thousand and Seventy Six Dollars ($323,076),
representing 11 months salary as a severance benefit, less any regular payroll
withholding. This payment shall be made upon the expiration of the revocation
period referenced in Section 5.C. below. Employee acknowledges that the
compensation paid under this section represents additional consideration for the
releases granted pursuant to Sections 5 and 6 of this Agreement and for all
other commitments and obligations contained in this Agreement.
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b. Restricted Stock Program. Employee will be eligible to receive the
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quarterly installment under the restricted stock program which will occur on
February 28, 2001. The Company also agrees to accelerate the quarterly
installment under the restricted stock program that was intended to occur on May
28, 2001, such that Employee will be eligible to receive that quarterly
installment on March 16, 2001. Employee will not have any right to any further
installment under the restricted stock program. Employee shall not be eligible
for any other bonus or compensation program.
c. Final Paycheck. The Company shall pay to Employee on the final day
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of employment, March 16, 2001, a check representing Employee's unpaid salary
through March 16, 2001 and all accrued, unused vacation benefits, less regular
payroll withholding and health and medical benefit premium deductions. In
addition, the Company shall return to Employee, by way of check, any amounts
withheld by Employee under the Company's Employee Stock Purchase Plan.
d. Benefits; COBRA. The Company shall continue to provide health and
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medical benefits to Employee through March 16, 2001, provided that the premiums
for such benefits will be deducted from the final paycheck. Employee will be
eligible for COBRA as of March 17, 2001. Company shall pay all premiums for
COBRA benefits on behalf of Employee through February 11, 2002; provided that
Company will pay such annual COBRA premium on or before March 17, 2001.
3. Employee Nondisclosure and Developments Agreement. Employee
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acknowledges and agrees that the Employee Nondisclosure and Developments
Agreement dated on or about March 1, 1999, a copy of which is attached hereto as
Exhibit A, is still in full force and effect and Employee shall continue to be
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bound by the terms thereof.
4. Continuing Commitments.
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a. Employee agrees to cooperate fully with the Company in its defense
of or other participation in any administrative, legal or other proceeding
arising from any charge, complaint or other action which has or may be filed. If
Employee is called upon to assist the Company after the expiration of this
Agreement, such out-of-pocket expenses as may be reasonably incurred by Employee
will be reimbursed by the Company, subject to appropriate documentation support.
Further, in the event that Employee is called upon to assist the Company, the
Company will work with Employee to avoid any unreasonable interference such
assistance might cause.
b. Employee agrees to assist in the transition of his duties as
requested by the Company, and continue to abide by all applicable policies and
procedures of the Company until the expiration of this Agreement.
c. Employee agrees that at the Company's request, or in any event,
upon the expiration of this Agreement, he will return all Company reports,
records and property, including any copies thereof, including but not limited to
diskettes, tapes, passwords, notebooks, sales materials, personnel data,
memoranda, notes, letters, plans, analyses, recaps, credit cards, keys, etc. to
the Company and to remove all personal belongings from the Company's premises;
provided however, that Employee may keep his desktop computer system for his
personal use to the extent Employee removes all proprietary and confidential
information of the Company that exists on such computer system.
d. As part of the consideration for the compensation Employee will
receive pursuant to this Agreement, Employee agrees that for a period of two (2)
years from the
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Effective Date of this Agreement he will not, directly or indirectly, solicit or
entice any employee of or consultant to the Company to leave the employ or
service of the Company, or otherwise cause or induce any employee or consultant
to accept employment with Employee or with any other person, firm, corporation,
association or entity. This section shall only apply with respect to employees
and consultants who are employed or engaged by the Company at the then current
time.
e. As of the Effective Date, Employee shall not contact or
otherwise communicate, on behalf of the Company, with any vendors, suppliers or
other third parties with which the Company does business unless expressly
instructed to do so by the Company's Chief Financial Officer, Chief Executive
Officer or Chairman of the Board of Directors.
f. In the event of any breach of the continuing commitments
enumerated in this Section 4, paragraphs a. through e., any outstanding
obligations of the Company hereunder shall immediately terminate and any
payments previously made by the Company hereunder shall be returned to the
Company, nevertheless, a breach of the continuing commitments contained herein
will not in any way relieve Employee of all the other terms and conditions
contained in this Agreement, nor shall the Company be deemed to have waived any
other remedy claim, suit, demand, or cause of action available to it by
terminating its obligations under the Agreement or receiving payments previously
made by Employee.
5. Release of Claims. In consideration of the above promises, Employee
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hereby agrees to the full compromise and release of any and all claims against
the Company and any entity affiliated or related to the Company, whether known
or unknown. It is expressly understood and agreed that no language in this
Agreement, including that which mentions the waiver of specific claims, is
intended to limit this release in any way, and that it is Employee's
understanding that no claim or potential claim against the Company shall survive
Employee's execution of this release.
a. Employee hereby releases and forever discharges the Company
and all of its parents, divisions, subsidiaries, affiliates, related entities
and their predecessors, successors, officers, shareholders, employees, agents
and representatives from any and all claims, including tort claims, wage claims,
demands, liabilities, debts, accounts, obligations, damages, compensatory
damages, punitive damages, liquidated damages, costs, expenses, actions and
causes of action which Employee has or claims to have, either known or unknown,
arising out of or in connection with Employee's employment relationship with the
Company including, without limitation, any claims relating to compensation,
stock options or other equity incentive program.
b. As a part of this Release and not by way of limitation,
Employee hereby expressly waives any and all claims which he has, either known
or unknown, against the Company, all of its divisions, subsidiaries, affiliates,
related entities and their predecessors, successors, officers, shareholders,
employees, attorneys, agents and representatives, arising out of or in
connection with any state or federal laws, ordinances, regulations, or orders
based on any charges of discrimination for any reason, including but not limited
to any claims asserted under the:
Civil Rights Act of 1964, as amended;
Civil Rights Act of 1991;
Civil Rights Act of 1866;
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Civil Rights Act of 1871;
Equal Pay Act of 1963, as amended
Employee Retirement Income Security Act;
Rehabilitation Act of 1973;
Americans with Disabilities Act of 1990;
Fair Labor Standards Act, as amended;
Family and Medical Leave Act;
Executive Order No. 11246;
California Labor Code;
California Fair Housing and Employment Act;
California Family Rights Act;
and/or any Municipal, State and Federal statutory and common law relating to
employment, human rights, civil rights, discrimination, breach of contract,
defamation, and any other cause of action or claim.
c. Release of Age Discrimination Claims. As a part of this
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Agreement, and without limiting the generality of the releases contained herein,
Employee expressly agree to the releases of any rights or claims arising out of
the Federal Age Discrimination in Employment Act ["ADEA", 29 U.S.C. (S) 621, et
seq,), and in connection with such waiver:
(i) Employee is hereby advised to consult with an attorney
prior to signing this Agreement.
(ii) Employee shall have a period of forty-five (45) days
from the date of receipt of the Agreement in which to consider the terms of
the Agreement. Employee may sign this Agreement before the expiration of
the forty-five (45) day consideration period. If Employee chooses to sign
the Agreement before the expiration of the forty-five (45) day
consideration period, Employee has chosen to do so voluntarily.
(iii) Employee may revoke this Agreement at any time during
the first seven (7) days following Employee's execution of the Agreement.
The terms of this Agreement shall not be effective or enforceable until
this seven (7) day period has expired.
(iv) Employee acknowledges that with this Agreement
Employee received a list that identified the age and job title of all
employees seperated by the Company as of the Effective Date.
6. Waiver of Unknown Claims. It is further understood and agreed by
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Employee that as a condition of this Agreement, Employee intends to release all
actions, claims and demands of any kind that he may have, whether known or
unknown, suspected or unsuspected against the Company. In furtherance of this
intention, Employee expressly waives any and all rights that he may have under
the provisions of Section 1542 of the California Civil Code, which provides:
SECTION 1542. CERTAIN CLAIMS NOT AFFECTED
BY GENERAL RELEASE. A GENERAL RELEASE DOES
NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR
AT THE TIME OF EXECUTING THE RELEASE WHICH
IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED
HIS SETTLEMENT WITH THE
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DEBTOR."
7. Assignment. This Agreement (together with all attachments) shall be
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binding upon Employee, and inure to the benefit of, the parties hereto and their
respective heirs, successors, assigns, and personal representatives; provided,
however, that it shall not be assignable by Employee and any attempted
assignment will be void.
8. Integration. This Agreement constitutes a single, integrated, written
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contract, expressing the entire agreement between the parties, and supercedes
any prior understanding or agreement of the parties. In this regard, Employee
represents and warrants that he is not relying on any promises or
representations which do not appear written herein. Employee further understands
and agrees that this Agreement can be amended or modified only by a written
agreement, signed by all of the parties hereto.
9. Notices. All notices required or given under this Agreement shall be
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addressed to the Company or Employee at the designated addresses shown below (or
such other address as may be provided by written notice in accordance with this
Section 9) and shall be deemed given upon receipt (or, if not received sooner,
three (3) days after deposit in the U.S. mails) when delivered by registered
mail, postage pre-paid, return receipt requested, by facsimile (with a
confirmation copy sent by registered mail) or by commercial overnight delivery
service with tracking capabilities:
To Company:
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Buy. Com Inc.
▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Copy To: General Counsel
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
To Employee:
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See Signature Page
10. Controlling Law and Jurisdiction. This Agreement shall be governed,
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controlled, interpreted and defined by and under the laws of the State of
California, without regard to the conflicts of laws provisions thereof. The
exclusive jurisdiction and venue of any action with respect to the subject
matter of this Agreement shall be the Superior Court of California for the
County of Orange or the United States District Court for the Central District of
California and each of the parties hereto submits itself to the exclusive
jurisdiction and venue of such courts for the purpose of any such action.
Service of process in any such action may be effected in the manner provided in
Section 9 for delivery of notices.
11. Attorneys' Fees. If any action at law or in equity is necessary to
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enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorney's fees, court costs and necessary disbursements,
in addition to any other relief to which the party may be entitled.
12. Confidentiality. Employee understands and agrees that this Agreement,
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and the matters discussed in negotiating its terms, are entirely confidential.
Its is therefore expressly understood and agreed by Employee that he will not
reveal, discuss, publish or in any way
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communicate any of the terms, amount or fact of this Agreement or the settlement
to any person, organization or other entity, with the exception of his
professional representatives, who shall be informed of and bound by this
confidentiality clause. Employee understands that the promise of confidentiality
contained in this paragraph was a material inducement for the Company to enter
into this Agreement.
13. No Admission. Employee and the Company agree that this Agreement
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which Employee has entered into voluntarily does not constitute an admission of
any violation of any statute or any other legal duty or obligation and shall not
be admissible in any proceeding except for purposes of enforcement.
14. Survival. The provisions of this Agreement intended to survive its
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termination, shall continue in effect after termination of this Agreement. The
Company is entitled to communicate Employee's obligations under this Agreement
to any future client or potential client of Employee.
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EMPLOYEE HAS READ THIS AGREEMENT CAREFULLY AND UNDERSTANDS AND ACCEPTS THE
OBLIGATIONS WHICH IT IMPOSES UPON EMPLOYEE WITHOUT RESERVATION. EMPLOYEE
ACKNOWLEDGES THAT EMPLOYEE WAS ADVISED BY THE COMPANY TO CONSULT WITH AN
ATTORNEY PRIOR TO SIGNING THIS AGREEMENT. EMPLOYEE FURTHER ACKNOWLEDGES THAT NO
PROMISES OR REPRESENTATIONS HAVE BEEN MADE TO EMPLOYEE TO INDUCE EMPLOYEE TO
SIGN THIS AGREEMENT AND THAT EMPLOYEE HAS NOT RELIED UPON ANY PROMISES OR
REPRESENTATIONS OF THE COMPANY WITH RESPECT TO THE OPERATION OR EFFECT OF THIS
AGREEMENT. EMPLOYEE SIGNS THIS AGREEMENT VOLUNTARILY AND FREELY.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
dates indicated below.
Dated: February 11, 2001 ▇▇▇▇ ▇▇▇▇▇▇▇
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
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Address:
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Dated: February 11, 2001 ▇▇▇.▇▇▇ INC.
By: ▇▇▇▇▇ ▇▇▇▇▇▇
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Title: CEO
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ACKNOWLEDGMENT OF RECEIPT
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The undersigned hereby acknowledges receipt of the Severance Agreement and
General Release on February 11, 2001.
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
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Signature
▇▇▇▇ ▇▇▇▇▇▇▇
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