Prepared by MerrillDirect





 


TERMINATION AGREEMENT &
RELEASE


             This
is an Agreement between Home Depot U.S.A., Inc. (the “Company”) and Mark R.
Baker (the “Executive”).


             WHEREAS, the Executive intends to resign from the Company;
and,


             WHEREAS, the Company and the Executive intend the terms and
conditions of this Agreement to govern all issues related to the Executive’s
employment and resignation from the Company; and,


             WHEREAS, the Executive acknowledges that he has been given a
reasonable period of time, up to and including twenty-one (21) days, to
consider the terms of this Agreement; and,


             WHEREAS, the Company advised the Executive in writing to
consult with a lawyer before signing this Agreement; and,


             WHEREAS, the Executive has represented and hereby reaffirms
that he has disclosed to the Company any information in his possession
concerning any conduct involving the Company or its affiliates that he has any
reason to believe involves any false claims to the United States or is or may
be unlawful or violates Company policy in any material respect; and,


             WHEREAS, the Executive acknowledges that the consideration
provided him under this Agreement is sufficient to support the releases
provided by him under this Agreement; and,


             WHEREAS, the Executive represents that he has not filed any charges,
claims or lawsuits against the Company involving any aspect of his employment
which have not been terminated as of the date of this Agreement; and,


             WHEREAS, the Executive understands that the Company regards
the representations by him as material and that the Company is relying on these
representations in entering into this 
Agreement,


NOW, THEREFORE, the Company and the Executive agree as follows:


1.          Employment
Status and Termination Date.  The
Executive shall continue as an active employee of the Company through August
31, 2001.  Executive shall then be
placed on a paid Leave of Absence (“LOA”) commencing on September 1, 2001 and
extending through the earlier of either (a) August 31, 2002 or (b) Executive’s
acceptance of employment outside the Company. 
If Executive accepts other employment, the paid LOA will end immediately
and Executive will be placed on an unpaid LOA, without pay or benefits, until
August 31, 2002.  Executive’s last day
of employment (“Termination Date”) will be August 31, 2002, or as otherwise
provided in paragraph 10 below. 
Executive will notify the Company, in writing, as soon as he has
accepted employment outside the Company. 
Executive shall not accrue any vacation days or credit subsequent to
August 31, 2001.







2.          Annual
Salary.  Executive shall continue at
his current salary level during the paid LOA.


3.          Annual
Bonus.  Executive shall be paid a
bonus for the Company’s 2001 fiscal year ending in 2002, equal to 100% of his
current annual salary, such payment to be paid at the same time as the Company
normally pays its other executive officers their bonuses.  This bonus payment will be contingent upon
Executive executing an additional release, the same as set forth in paragraph 7
below, covering the period between the Effective Date of this Agreement through
August 31, 2001.


Executive shall not be entitled to any
bonus for the Company’s 2002 fiscal year ending in 2003.


4.          Benefits.  The Executive will be eligible to continue
to participate in the Company’s employee benefit plans and programs during the
paid LOA.  Provided that Executive does
not breach any of the terms of this Agreement, the Company agrees that as of
June 29, 2001, the $170,000 of the original outstanding principal balance and
any related accrued interest thereon that Executive owes the Company under the
Promissory Note dated December 29, 2000, shall be forgiven and forever
discharged.  The Company shall reimburse
Executive for any federal and state taxes paid by him due to the cancellation
of such indebtedness, on a fully tax grossed-up basis.


5.          Stock
Options. All of Executive’s outstanding, non-vested stock options will vest
in accordance with the terms of the original grant except that none of such
options shall vest after the Termination Date. 
All of Executive’s vested stock options must be exercised within 90 days
of the Termination Date.  Executive
shall not be eligible to receive any stock option grants subsequent to August
31, 2001.


6.          Outplacement
Services.  The Company shall provide
outplacement services for the Executive during the paid LOA.  Such services shall be provided through an
agency selected by the Company. 
Services shall include the reasonable costs of office space, use of
equipment, such as a personal computer, copier, phone, fax machine, and
administrative support.


7.          Release
of Claims. The Executive and his heirs, assigns, and agents release, waive
and discharge the Company and its past and present directors, officers,
employees, subsidiaries, affiliates, and agents from each and every claim,
action or right of any sort, known or unknown, arising on or before the
Effective Date.


(a)         The foregoing release includes, but is
not limited to, any claim of discrimination on the basis of race, sex,
religion, marital status, sexual orientation, national origin, handicap or
disability, age, veteran status, special disabled veteran status, or
citizenship status; any other claim based on a statutory prohibition; any claim
arising out of or related to an express or implied employment contract, any other
contract affecting terms and conditions of employment, or a covenant of good
faith and fair dealing.








(b)        The
Executive represents that he understands the foregoing release, that rights and
claims under the Age Discrimination in Employment Act of 1967, as amended, are
among the rights and claims against the Company he is releasing, and that he
understands that he is not presently releasing any rights or claims arising
after the Effective Date.



(c)         The Executive further agrees never to
sue the Company or cause the Company to be sued regarding any matter within the
scope of the above release. If the Executive violates this release by suing the
Company or causing the Company to be sued, the Company may recover all damages
as allowed by law, including all costs and expenses of defending against the
suit incurred by the Company and reasonable attorneys’ fees.



The Company releases, waives, and
discharges Executive from each and every claim, action or right of any sort,
arising on or before the Effective Date and based upon facts presently known to
the Executive Vice President, Human Resources.


8.          Confidential
Information.  The Executive
acknowledges that, in connection with his employment at the Company, he
obtained knowledge about confidential and proprietary information, or trade
secrets of the Company, including but not limited to lists of customers and
vendors, technical information about Company products, strategic plans of
company businesses and price information (hereinafter the “Information”).
Executive agrees, either prior to or following the Effective Date, not to use,
publish or otherwise disclose any Information to others, including but not
limited to a subsequent employer or competitor to the Company. If the Executive
has any question regarding what data or information would be considered by the
Company to be information subject to this provision, the Executive agrees to
contact the Executive Vice President, Human Resources for written
clarification.


9.          Non-Competition
and Non-Solicitation. 


(a)         The Executive agrees that he will not,
prior to August 31, 2004, enter into or maintain an employment or contractual
relationship, either directly or indirectly, to provide services to any company
or entity engaged in any way in a business that competes directly or indirectly
with the Company without the prior written consent of the Company.  Businesses that compete with the Company
specifically include, but are not limited to, the following entities and each
of their subsidiaries affiliates, assigns, or successors in interest:  Lowe’s Companies, Inc. (including, but not
limited to, Eagle Hardware and Garden); Hechinger Investment Company, Inc.
(including, but not limited to, Home Quarters, Hechinger, and Builder’s
Square); Payless Cashways, Inc.; Dekor; Sears (including, but not limited to,
Orchard Supply and Hardware Company); Wal-Mart; Home Base, Inc; and Menard,
Inc.



(b)        To the extent that any relationship or
employment prior to August 31, 2004 is covered by the above non-compete
provision, Executive agrees to request permission from the Executive Vice
President, Human Resources of the Company prior to entering any such
relationship or employment. The Company may approve or not approve of the
relationship or employment at its absolute discretion.








(c)         The Executive
agrees that prior to August 31, 2004, he will not directly or indirectly
solicit any person who is an employee of the Company to terminate his or her
relationship with the Company without prior written approval from the Executive
Vice President, Human Resources of the Company.



10.        Breach
by Executive.  The Company’s
obligations to the Executive under this Agreement, including the loan
forgiveness set forth in paragraph 5 above, are contingent on Executive’s
performance of his obligations under this Agreement. Any material breach by
Executive of this Agreement will result in the immediate cancellation of all
Executive’s stock options and the immediate termination of Executive’s
employment, as well as entitle the Company to all its other remedies in law or
equity.  In the event of such breach,
Executive would also be required to repay the $170,000 principal balance of the
Promissory Note dated December 29, 2000, plus interest accrued from June 29,
2000, calculated in accordance with the terms of the Promissory Note.


11.        Executive
Availability.  The Executive agrees
to make himself reasonably available to the Company to respond to requests by
the Company for information pertaining to or relating to the Company and/or the
Company’s affiliates, subsidiaries, agents, officers, directors or employees
which may be within the knowledge of the Executive. Executive will cooperate
fully with the Company in connection with any and all existing or future
litigations or investigations brought by or against the Company or any of its
past or present affiliates, agents, officers, directors or employees, whether
administrative, civil or criminal in nature, in which and to the extent the
Company deems the Executive’s cooperation necessary. The Company will reimburse
the Executive for reasonable out-of-pocket expenses incurred as a result of
such cooperation. Nothing herein shall prevent the Executive from communicating
with or participating in any government investigation.


12.        Non
Disparagement.  The Executive
agrees, subject to any obligations he may have under applicable law, that he
will notmake
or cause to be made any statements that disparage, are inimical to, or damage
the reputation of the Company or any of its past or present affiliates,
subsidiaries, agents, officers, directors or employees. In the event such a
communication is made to anyone, including but not limited to the media, public
interest groups and publishing companies, it will be considered a material
breach of the terms of this Agreement and the Executive will be required to
reimburse the Company for any and all compensation and benefits paid under the
terms of this Agreement and all commitments to make additional payments to the
Executive will be null and void.


13.        Insider
Trading.  The Executive acknowledges
that prior to the Termination Date, he remains subject to the restrictions of
the Company’s Insider Trading Policy. 
After the Termination Date, the Insider Trading Policy will no longer
apply to the Executive.  However, the
Executive acknowledges that through his employment with the Company he may have
learned material, non-public information regarding the Company.  The federal securities laws prohibit trading
by persons while aware of material, non-public information.  The Executive should seek advice of his
legal counsel prior to conducting any transactions in the Company’s stock if
the Executive thinks he may possess such information.







14.         Future
Employment. The Executive agrees and acknowledges that the Company, its
affiliates, or subsidiaries are not obligated to offer employment to the
Executive (or to accept services or the performance of work from the Executive
directly or indirectly) now or in the future.


15.        Severability
of Provisions. In the event that any provision in this Agreement is determined
to be legally invalid or unenforceable by any court of competent jurisdiction,
and cannot be modified to be enforceable, the affected provision shall be
stricken from the Agreement, and the remaining terms of the Agreement and its
enforceability shall remain unaffected.


16.        Right
to Revoke this Agreement. The Executive may revoke this Agreement in
writing within seven days of signing it. The Agreement will not take effect
until the Effective Date. If the Executive revokes this Agreement, all of its
provisions shall be void and unenforceable.


17.        Effective
Date. The Effective Date shall be the day after the end of the revocation
period described in Section 16.


18.        Confidentiality.
The Executive shall keep strictly confidential all the terms and conditions,
including amounts, in this Agreement and shall not disclose them to any person
other than the Executive’s spouse, the Executive’s legal or financial advisor,
or U.S. governmental officials who seek such information in the course of their
official duties, unless compelled by law to do so. If a person not a party to
this Agreement requests or demands, by subpoena or otherwise, that the
Executive disclose or produce this Agreement or any terms or conditions
thereof, the Executive shall immediately notify the Company and shall give the
Company an opportunity to respond to such notice before taking any action or
making any decision in connection with such request or subpoena.


19.        Survival
of Provisions.  Paragraphs 8, 9, 11,
and 18 shall survive the term of this Agreement.


20.        Entire
Agreement. This Agreement constitutes the entire understanding between the
parties. The parties have not relied on any oral statements that are not
included in this Agreement. Any modifications to this Agreement must be in writing
and signed by the Executive and an authorized employee or agent of the Company.







21.        This
Agreement shall be construed, interpreted and applied in accordance with the
law of the State of Delaware, without giving effect to the choice of law
provisions thereof.


 


	Home
  Depot U.S.A., Inc.
	 
	By	/s/
  Dennis M. Donovan	 	6/13/01	 
	 	

	 	

	 
	 	Dennis
  M. Donovan	 	Date	 
	 	Executive
  Vice President	 	 	 
	 	Human
  Resources	 	 	 
	 	 	 	 	 
	 	/s/
  Mark R. Baker	 	6/13/01	 
	 	

	 	

	 
	 	Mark
  R. Baker	 	Date	 
	 	Executive