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EMPLOYMENT SEPARATION AGREEMENT

Employee Retention Agreement

EMPLOYMENT SEPARATION AGREEMENT | Document Parties: iRobot Corporation You are currently viewing:
This Employee Retention Agreement involves

iRobot Corporation

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Title: EMPLOYMENT SEPARATION AGREEMENT
Governing Law: Massachusetts     Date: 2/13/2009
Industry: Appliance and Tool     Sector: Consumer Cyclical

EMPLOYMENT SEPARATION AGREEMENT, Parties: irobot corporation
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EXHIBIT 10.32

EMPLOYMENT SEPARATION AGREEMENT

     This Employment Separation Agreement (the “Agreement”) is entered into by and between Helen Greiner (“Ms. Greiner” or the “Executive”) and iRobot Corporation (“iRobot” or the “Company”) as of October 22, 2008.

     WHEREAS, Ms. Greiner is a founder of iRobot and currently serves as Chairman of the Board of the Company;

     WHEREAS, Ms. Greiner has indicated her desire to resign from active employment with the Company to pursue business opportunities in the area of unmanned aerial vehicles (“UAV”);

     WHEREAS, Ms. Greiner wishes to resign from her employment with the Company and her position as Chairman of the Board;

     WHEREAS, both Ms. Greiner and iRobot desire that Ms. Greiner continue to serve as a Director of the Company;

     WHEREAS, Ms. Greiner and iRobot now wish to extinguish all prior agreements relating to severance pay and benefits including without limitation, the Executive Agreement dated March 15, 2006 (the “Executive Agreement”) and replace all such agreements with this Agreement which sets forth the terms and conditions of the separation of Ms. Greiner’s employment from the Company.

     NOW THEREFORE, in consideration of the mutual promises contained in this Agreement, Ms. Greiner and iRobot agree as follows:

     1.  Resignation and Continued Service . Ms. Greiner’s resignation from employment with iRobot is effective October 24, 2008 (the “Separation Date”). In addition, Ms. Greiner resigns, effective as of October 24, 2008 as Chairman of the Board and, except as provided in the following sentence, all other offices of the Company and any of its subsidiaries that she currently holds. Ms. Greiner will continue to serve as a non-employee director of the Company.

     2.  Payments and Benefits to Executive .

 

a.

 

Separation Pay . Ms. Greiner will receive separation pay from the Company in the total amount equal to one year’s salary continuation ($330,625), payable in equal installments bi-weekly on the Company’s regular payroll dates except as provided below. The Company has determined that Ms. Greiner is a “specified employee” within the

 


 

 

 

 

meaning of Section 409A(a)(2)(B)(i) of the Internal Revenue Code (the “Code”). The Company also has determined that the services to be provided by Ms. Greiner subsequent to the Separation Date, pursuant to Sections 9 and 10 below, will be less than 20% of the average level of services she provided to the Company during the preceding 36 months. Because the salary continuation payments will be considered deferred compensation subject to Section 409A of the Code, such payments shall not be payable until the date that is the earlier of (i) six months and one day after the Separation Date or (ii) Ms. Greiner’s death. The first salary continuation installment shall include a catch-up payment covering amounts that would otherwise have been paid during the six-month period but for the application of this provision, and the balance of the installments shall be payable in accordance with their original schedule.

 

 

b.

 

Usual Benefits . Consistent with the Company’s policies, Ms. Greiner will continue to be eligible for employee benefits through the Separation Date, including medical and dental benefits and accrual of vacation. No later than the next regular payroll date following the Separation Date, iRobot shall pay Ms. Greiner all salary due and owing and any accrued but unused vacation. In addition, the Company shall reimburse Ms. Greiner for business expenses incurred on or before the Separation Date, in accordance with the Company’s expense reimbursement practices. Except as set forth below, Ms. Greiner’s eligibility to participate in other employee benefits will cease upon the Separation Date.

 

 

c.

 

Health Benefits Continuation . If Ms. Greiner elects to continue her medical and dental insurance coverage after the Separation Date under the law known as COBRA, the Company shall pay a percentage of the medical and dental insurance premiums for Ms. Greiner and her dependents, equal to the same percentage of such premiums paid by the Company during Ms. Greiner’s employment, from the Separation Date until the earlier of: (i) four months from the Separation Date; (ii) the date Ms. Greiner and her dependents become eligible for health or dental insurance through another employer; or (iii) the date Ms. Greiner and her dependents become ineligible for COBRA for any reason (the “Benefits Continuation Period”). Ms. Greiner agrees to notify the Company promptly upon becoming eligible for health or dental insurance from another employer or upon becoming otherwise

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ineligible for COBRA. If Ms. Greiner elects COBRA continuation coverage, she may continue coverage for herself and any dependents after the end of the Benefits Continuation Period at her own expense for the remainder of the COBRA period, to the extent she and they remain eligible.

 

 

d.

 

Acceleration of Unvested Stock Options and Restricted Stock . Schedule A hereto sets forth a summary of certain outstanding stock options and restricted stock awards granted to Ms. Greiner by the Company pursuant to the Company’s stock option and incentive plans (“Stock Option Plans”) and the relevant award agreements (“Award Agreements”). The parties agree that, if Ms. Greiner ceases to serve as a Director of the Company, they will execute a separate agreement under which all of Ms. Greiner’s stock options and restricted stock awards listed on Schedule A will vest upon the date that she ceases to serve as a Director.

 

 

e.

 

Incentive Pay . Ms. Greiner is currently eligible to receive Incentive Pay for calendar year 2008 in an amount up to 80% of her annual salary. The amount equal to 80% of her annual salary is referred to herein as “Full Incentive Pay.” The parties agree that Ms. Greiner will receive as Incentive Pay for calendar year 2008 a percentage of her salary (pro rated to the Separation Date) that is equal to the highest percentage of salary paid to any iRobot executive not subject to a guaranteed bonus for calendar year 2008, provided, however, that if the Company receives notice from the U.S. Government prior to December 27, 2008 that the Company has been awarded its bid on the pending XYZ program, Ms. Greiner will receive no less than Full Incentive Pay for calendar year 2008. The incentive payment will be made on or before March 15, 2009.

 

 

f.

 

Payment in Lieu of Matching 401k Contribution. Since Ms. Greiner’s employment will end prior to December 31, 2008, she will not be eligible for any matching contributions by the Company for the 2008 Plan Year under the Company’s 401k Savings Plan. In lieu of such contributions, the Company shall make a lump sum payment to Ms. Greiner in the amount of $6,900, net of applicable tax withholdings, on or before March 31, 2009.

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g.

 

Tax Treatment . The Company shall undertake to make deductions, withholdings and tax reports with respect to payments and benefits under this Agreement to the extent that it reasonably and in good faith determines that it is required to make such deductions, withholdings and tax reports. Nothing in this Agreement shall be construed to require the Company to make any payments to compensate Ms. Greiner for any adverse tax effect associated with any payments or benefits or for any deduction or withholding from any payment or benefit.

     3.  Confidentiality and NonCompetition and NonSolicitation Agreement and No Corporate Opportunity . Ms. Greiner shall not disclose to any third party any information which, during her employment, she knew, or reasonably should have known, is considered by the Company to be confidential and/or proprietary. The foregoing is in addition to, and not in lieu of, any obligation set forth in the NonCompetition and NonSolicitation Agreement between Ms. Greiner and iRobot dated March 15, 2006 (the “NonCompetition and NonSolicitation Agreement”), which terms and conditions shall remain in full force and effect and are incorporated herein by reference. The Company acknowledges and agrees that business activity in the area of UAV would not be a competitive business activity within the meaning of the Non-Competition and Non-Solicitation Agreement and that Ms. Greiner may work in the area of UAV without violating her non-competition obligations under that agreement. The Company further acknowledges that Ms. Greiner may solicit any and all Govern


 
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