EXHIBIT
10.6


 


SEVERANCE
PAYMENT AGREEMENT


(Amended
and Restated as of November 4, 2008)


 


This
Severance Agreement was entered into as of January 30, 2002 between
Internet Brands, Inc., formerly CarsDirect.com, Inc., (the “Company”)
and Lynn Walsh (the “Employee”) and is hereby amended and restated as of November 4,
2008.


 


WHEREAS,
Employee is a senior executive of the Company in the capacity of Executive Vice
President and General Counsel;


 


WHEREAS,
the Company desires to recognize Employee’s continued contribution to the
growth and stability of the Company and provide an additional incentive for
Employee to remain at the Company;


 


NOW,
THEREFORE, in consideration of the covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, the parties agree as follows:


 


1.               Severance Payment.    If
the Company terminates Employee’s employment without Cause, as defined in
paragraph 2 below, and for reasons other than death or disability, and such termination
constitutes a “separation from service” within the meaning of Section 409A
of the Internal Revenue Code of 1986, as amended, and the applicable guidance
issued thereunder (“Section 409A”), the Company will make a lump sum
payment to Employee which payment shall be equal to nine months of Employee’s
base salary plus 75% of Employee’s annual stated cash bonus target.  Notwithstanding the foregoing, it shall be a
condition to Employee’s right to receive such payment that Employee executes
and delivers to the Company a full general release of claims within twenty-one
(21) days following the date of such termination and the statutory period for
rescission of such release elapses without revocation of such release.  Such payment shall be made on the date following
the termination date on which statutory period has lapsed, but in all cases, no
later than sixty (60) days following the termination date.  In addition, Employee shall receive nine
months of continued health, dental and life insurance benefits under COBRA on
the same premium copayment terms as Employee had while employed at the Company
provided that Employee was enrolled in such plans on the date of termination,
subject to Employee’s timely election and maintenance of  COBRA coverage. Notwithstanding the foregoing
sentence, if Employee retains alternative employment during the nine month
severance period and the new employer offers such benefits, Employee’s health,
dental and/or life insurance benefits shall terminate on the date that such
benefits commence at the new employer.


 


2.     Acceleration of Vesting of Equity Grants
Upon a Change of Control.  On the
occurrence of a Change of Control (defined below) (i) each of Employee’s
equity grants that are not otherwise fully vested shall automatically vest on a
daily prorata basis over the period starting from the most recent vesting date
of each such grant prior to the Change of Control


 


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through immediately prior to the closing date of the Change of Control;
(ii) the remaining unvested  portion
of each of Employee’s equity grants shall automatically vest 50% immediately
prior to the closing date of the Change of Control. Immediately prior to the
closing of the Change of Control transaction, the Company or the successor
entity will reserve amounts sufficient to pay Employee for the remaining 50% of
unvested equity grants (in cash and/or publicly traded stock of the successor
entity on the same terms as provided to Company stockholders on the closing
date). Such remaining 50% shall continue to vest under the terms of such equity
grant agreements through the earlier of the first anniversary of the closing
date of the Change of Control transaction or a termination of Employee under
this subsection (c), upon which date all remaining unvested equity grants shall
automatically vest and Employee shall be paid all amounts reserved for such
purpose to Employee. “Change of Control” shall mean (i) the consummation
of a merger or consolidation of the Company with any other corporation, other
than a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities
of the surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or (ii) the
consummation of the sale or disposition by the Company of all or substantially
all the Company’s assets,


 


3.               Cause.            For purposes of paragraph 1 above, “Cause”
shall be defined as (i) termination for any act of personal dishonesty
taken by Employee in connection with Employee’s responsibilities to the Company
after repeated written warnings, (ii) a felony conviction, (iii) termination
due to a willful act that constitutes misconduct and is injurious to the
Company after repeated written warnings, or (iv) gross negligence,
recklessness, or willful misconduct or malfeasance in the performance by
Employee of her duties after repeated written warnings.


 


4.               Taxes.              All payments made pursuant to this Agreement
shall be subject to withholding of applicable income and employment taxes.


 


5.               Section 409A.  To
the extent applicable, this Agreement shall be interpreted in a manner that
satisfies, or qualifies for exemption from, the requirements of Section 409A.  Notwithstanding any provision of this
Agreement to the contrary, if the Company determines that any payments or
benefits payable under this Agreement may be subject to Section 409A, the
Company may, with Employee’s prior written consent, adopt such amendments to
this Agreement or adopt other policies or procedures (including amendments,
policies and procedures with retroactive effect), or take any other actions,
that the Company determines are necessary or appropriate to comply with, or
exempt such payments and benefits from, the requirements of Section 409A.


 


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IN
WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
of the Company by its duly authorized officer, as of November 4, 2008.


 


	
  INTERNET BRANDS, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Robert N. Brisco

  	
   

  	
   

  
	
   

  	
  Robert
  N. Brisco

  	
   

  	
   

  
	
   

  	
  Chief
  Executive Officer

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EMPLOYEE:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Lynn Walsh

  	
   

  	
   

  
	
   

  	
  Lynn
  Walsh

  	
   

  	
   

  



 


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