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Severance Agreement With Greg Hawkins

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This Severance Agreement and General Release (collectively, the "Agreement") is effective as of February 11, 2001, (the "Effective Date") by and between Buy.Com Inc., a Delaware corporation (the "Company"), and Greg Hawkins ("Employee").


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.


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
----------------------- 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
------------------- 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:

a. Severance Payment. The Company shall pay to Employee his current
----------------- 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.


b. Restricted Stock Program. Employee will be eligible to receive the
------------------------ 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
-------------- 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
--------------- 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
------------------------------------------------- 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 --------- bound by the terms thereof.

4. Continuing Commitments.

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 wil
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