EXHIBIT 10.1
SEPARATION AGREEMENT AND RELEASE
OF ALL CLAIMS
This Separation Agreement and
Release of All Claims (the “ Agreement ”)
is between Michael J. McClane (“Employee”) and U.S.
Auto Parts Network, Inc., its officers, directors, employees,
foreign and domestic subsidiaries, benefit plans and plan
administrators, affiliates, agents, joint ventures, attorneys,
successors and/or assigns (collectively referred to as “
Company ”).
RECITALS
Employee is employed by the Company
as its Executive Vice President, Chief Financial Officer, Secretary
and Treasurer, as an officer of Company subsidiaries and serves as
a trustee for the Company 401(k) plan. Employee has
resigned without Good Reason as defined in that employment
agreement dated January 17, 2007 (“Employment
Agreement”) and his employment with the Company shall
terminate December 11, 2008 (“
Termination Date ”). Employee and
the Company mutually desire to eliminate any future
disputes. As a demonstration of that desire, the Company
has elected to offer Employee compensation and benefits to which he
would not otherwise be entitled. The Company expressly
disclaims any wrongdoing or any liability to
Employee. This Agreement and compliance with it shall
not be construed as an admission by the Company of any liability or
violation to the rights of Employee or any other person or as a
violation of any order, law, statute duty or contract whatsoever as
to Employee or any person.
AGREEMENTS
Based upon the foregoing, and in
consideration of the mutual promises contained in this Agreement,
Employee and the Company agree, effective upon the date of
execution by Employee, as follows:
1.
Acknowledgment . Employee acknowledges that he
has been paid all regular salary, expenses, commissions,
distributions, bonuses and Company benefits due and owing as of the
Termination Date, less appropriate withholdings and is not owed any
monies allowed, including but not limited to those required under
the California Labor Code, as of the Termination
Date. This sum is not consideration for this
Agreement.
The Company will pay Employee $37,106.66 (275.64
hours X $134.62) for vacation days and $3,230.88 (24 X $134.62) for
sick days. This sum is likewise not consideration for
this Agreement. Information regarding the transfer
or distribution of his USAP 401(k) Retirement Plan account will be
provided to Employee under separate cover by Principal Financial
Group. Company confirms that employee will be 100%
vested in all employer contributions made by the Company for the
benefit of the employee which would otherwise occur on December 31,
2008.
2.
Consideration . The Parties recognize and affirm
that, except as stated in Section 1 of this Agreement, the
Company is not obligated to provide Employee with any of the
benefits set forth herein. The Company agrees to provide
Employee the following consideration (the “
Payment ”) four (4) business days after the
expiration of the seven (7) day revocation period described in
Paragraph 7 below (“ Effective Date ”)
which Effective Date, assuming Employee waives the 21-day
consideration period, would be December 19, 2008, provided Employee
has not revoked this Agreement as described in that
Paragraph:
(a) Payment of
$280,000, which is equivalent to twelve (12) months of
Employee’s current base salary, less standard employee
withholding taxes, payable ratably every two (2) weeks or otherwise
in accordance with the regular payroll practices of the
Company. Payments to commence on the Effective
Date.
(b) Should the
Company’s Compensation Committee or Board of Directors offer
the CEO a bonus in cash, equity or a combination thereof, for
services provided in 2008, then such percentage of target bonus
shall also be provided to Employee whether or not the CEO accepts
such bonus payment. Payment to be made to Employee at
the time in 2009 that such bonus would ordinarily be
paid.
(c) Employee waives
any claim for entitlement to any Company payment or reimbursement
of health insurance benefits under COBRA that he might have had
under the Employment Agreement.
Employee understands and acknowledges that he is
not entitled to and would not receive the aforementioned
consideration, including the Payment, but for compliance with the
terms and conditions of this Agreement. Employee further
acknowledges that said consideration does not include any wages,
accrued but unused vacation or any other money or income to which
the Employee is otherwise entitled.
3. Taxes
. Not withstanding the tax deductions set forth in
Paragraph 2 above, Employee shall pay in full when due, and shall
be solely responsible for, any and all federal, state, or local
income taxes that are or may be assessed against him relating to
the consideration provided including the Payment received pursuant
to this Agreement, as well as all interest or penalties that may be
owed in connection with such taxes. Employee is not
relying on any representations or conduct of the Company with
respect to the adequacy of the withholdings.
4. Non-Admission
of Liability . The Company hereby disclaims any wrongdoing
against Employee. Company expressly denies that it engaged in any
unlawful conduct of any kind. Employee agrees that
neither this Agreement, nor the furnishing of the consideration for
the release contained herein shall be deemed or construed at any
time for any purpose as an admission by Company of any liability or
unlawful conduct of any kind.
(a) Employee, on
behalf of himself, his fiancée successors, heirs,
and assigns, hereby forever relieves, releases, and discharges the
Company as well as its past, present and future officers,
directors, administrators, shareholders, employees, agents,
attorneys, insurers, divisions, successors, subsidiaries, parents,
assigns, representatives, brother/sister corporations, and all
other affiliated or related corporations, all benefit plans
sponsored by the Company, and entities, and each of their
respective present and former agents, employees, or
representatives, insurers, partners, associates, successors, and
assigns, and any entity owned by or affiliated with any of the
above, from any and all claims, debts, liabilities, demands,
obligations, liens, promises, acts, agreements, costs and
expenses (including but not limited to attorneys’
fees), damages, actions, and causes of action, of whatever kind or
nature, including but not limited to any statutory, civil,
administrative, or common law claims, whether known or unknown,
suspected or unsuspected, fixed or contingent, apparent or
concealed, arising out of any act or omission occurring before
Employee’s execution of this Agreement, including but not
limited to any claims based on, arising out of, or related to
Employee’s employment with, or the ending of Employee’s
employment with the Company, any claims arising from rights under
federal, state, and local laws relating to the regulation of
federal or state tax payments or accounting; federal, state or
local laws that prohibit harassment or discrimination on the basis
of race, national origin, religion, sex, gender, age, marital
status, bankruptcy status, disability, perceived disability,
ancestry, sexual orientation, family and medical leave, or any
other form of harassment or discrimination or related cause of
action (including but not limited to failure to maintain an
environment free from harassment and retaliation, inappropriate
comments or touching and/or “off-duty” conduct of other
Company employees); statutory or common law claims of any kind,
including but not limited to, any alleged violation of Title VII of
the Civil Rights Act of 1964, The Civil Rights Act of 1991,
Sections 1981 through 1988 of Title 42 of the United States Code,
as amended; The Employee Retirement Income Security Act of 1971, as
amended, The Americans with Disability Act of 1990, as amended, the
Workers Adjustment and Retraining Notification Act, as amended; the
Occupational Safety and Health Act, as amended, the Sarbanes-Oxley
Act of 2002, the California Family Rights Act (Cal. Govt. Code
§ 12945.2 et. seq .), the California Fair
Employment and Housing Act (Cal. Govt. Code § 12900
et. seq .), statutory provision regarding
retaliation/discrimination for filing a workers’ compensation
claim under Cal. Labor Code § 132a, California Unruh
Civil Rights Act, California Sexual Orientation Bias Law (Cal. Lab.
Code § 1101 et. seq .), California AIDS Testing
and Confidentiality Law, California Confidentiality of Medical
Information (Cal. Civ. Code § 56 et. seq .),
contract, tort, and property rights, breach of contract, breach of
implied-in-fact contract, breach of the implied covenant of good
faith and fair dealing, tortious interference with contract or
current or prospective economic advantage, fraud, deceit, invasion
of privacy, unfair competition, misrepresentation, defamation,
wrongful termination, tortious infliction of emotional distress
(whether intentional or negligent), breach of fiduciary duty,
violation of public policy, or any other common law claim of any
kind whatsoever; any claims for severance pay, sick leave, family
leave, liability pay, overtime pay, vacation, life insurance,
health insurance, continuation of health benefits, disability or
medical insurance, or Employee’s unvested 401(k) rights or,
except as stated in Section 2, any other fringe benefit or
compensation, including but not limited to unvested stock options;
any claim for damages or declaratory or injunctive relief of any
kind arising from the foregoing items. The Parties agree
and acknowledge that the release contained in this Paragraph 4 does
not apply to any vested rights Employee may have under any 401(k)
Savings Plan with the Company or to any rights under any
Indemnification Agreements into which Employee and Company have
entered. Employee represents that at the time of the
execution of this Agreement; he suffers from no work-related
injuries and has no disability or medical condition as defined by
the Family Medical Leave Act. Employee represents that
he has no workers’ compensation claims that he intends to
bring against the Company. Employee understands that
nothing contained in this Agreement, including, but not limited to,
this Paragraph 5, will be interpreted to prevent him from filing a
charge with a governmental agency or participating in or
cooperating with an investigation conducted by a governmental
agency, including the Equal Employment Opportunity
Commission. However, Employee agrees that he is waiving
the right to monetary damages or other individual legal or
equitable relief awarded as a result of any such
proceeding. Employee further acknowledges that this
release also releases the Company for all claims of unpaid wages,
including unpaid overtime wages, related to his employment with the
Company and subject to the terms specified in Paragraph 2 of this
Agreement.
(b) Company, except as
provided in paragraph 5(c) below, hereby forever relieves,
releases, and discharges Employee from any and all claims, debts,
liabilities, demands, obligations, liens, promises, acts,
agreements, costs and expenses (including but not
limited to attorneys’ fees), damages, actions, and causes of
action, of whatever kind or nature, including but not limited to
any statutory, civil, administrative, or common law claims, whether
known or unknow
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