<PAGE>

                                                                    EXHIBIT 10.1

                              SEPARATION AGREEMENT

     This Separation Agreement (the "Agreement") is between you, Frederick A.
Smith, on behalf of yourself, your spouse, your family, and anyone acting for
you including attorneys, agents, representatives, heirs, executors, and assigns
("you"), and Leapnet, Inc., and its subsidiaries and affiliates, its
predecessors, successors, assignees, agents, employees, officers, and directors
(collectively, "Leapnet").  This Agreement is entered into as of the date you
sign it on the last page directly below your signature (the "Effective Date").
In this Agreement, all references to "we" mean you and Leapnet.

     1.  Separation from Employment, Board Membership and Chairmanship.  You
         -------------------------------------------------------------
hereby elect to resign from Leapnet employment, membership on Leapnet, Inc.'s
Board of Directors, and your position as Chairman of the Board in accordance
with Section 2(b) of the Employment Agreement, dated March 12, 1999, between you
and The Leap Group, Inc. (now known as Leapnet, Inc.) (the "Employment
Agreement").  Leapnet waives its right to receive 270 days' prior written notice
of your resignation under the Employment Agreement, and you agree that your
termination date will be the Effective Date.

     You also hereby elect to terminate, as of the Effective Date, your
membership on any Board committee and your membership on the boards of
directors, and committees thereof, of all affiliates and subsidiaries of Leapnet
upon which you currently serve.  As of the Effective Date, you also hereby elect
to resign from all offices you hold with affiliates and subsidiaries of Leapnet.

     We have agreed on a joint public announcement of your resignation. Because
the announcement sets forth our understandings in connection with your
separation, we hereby agree that, except as required by law or regulation or in
connection with your future employment process, no further announcements or
disclosures are warranted.  However, before either of us makes any disclosure
about your separation, that party agrees to notify the other party, and the
notice will include a detailed summary of the proposed disclosure.  We further
agree that the termination of our employment relationship is as a result of a
joint amicable decision and does not merit any disparaging remarks or comments
by either of us, and such remarks or comments will be deemed a breach of this
Agreement.  Notwithstanding the foregoing, you acknowledge that the Company
intends to file an 8-K to which this Agreement will be attached.

     2.  Separation Payment and Benefits.  In consideration for the promises
         -------------------------------
contained in this Agreement, you are entitled to receive the following on
account of your separation:

     A.  Separation Payment.  Leapnet, Inc. will pay you $550,000, less all
         ------------------
applicable federal, state, and local payroll deductions (the "Separation
Payment"), in a lump sum on the day following the Revocation Period set forth in
Paragraph 4.

     B.  Company-paid Health Care Benefits. Leapnet, Inc. will provide you and
         ---------------------------------
your eligible dependents with Company-paid health care benefits through December
31, 2001, subject to the continued payment of your share of the monthly premium,
and thereafter you may be entitled to purchase additional months of continuation
coverage at your sole cost under the Consolidated Omnibus Budget Reconciliation
Act of 1985 (the federal law known as "COBRA") for the maximum period permitted
by law.  You will be deemed to have elected to exercise your rights under COBRA
as of the first day following the Effective Date.
<PAGE>

     C.  Company-paid Life Insurance Premiums.  Leapnet, Inc. will continue to
         ------------------------------------
pay the premiums on your two current Company-provided life insurance policies
through December 31, 2001.

     Leapnet, Inc. will pay you:  (1) your current salary through December 31,
2000, in accordance with the Company's normal payroll practices; (2) all accrued
but unused vacation time through the Effective Date, which amount will be paid
as soon as practicable after the Effective Date; and (3) all reimbursements due
to you for approved business expenses incurred before the Effective Date, which
amount will be paid in accordance with Leapnet's customary business expense
reimbursement policies and procedures.  You will also be entitled to receive all
vested benefits payable in accordance with Leapnet's benefit plans and programs.

     3.  Covenant Not to Sue/Release and Waiver.  In exchange for the Separation
         --------------------------------------
Payment, Company-paid health care benefits and Company-paid life insurance
premiums described in Paragraph 2, you, on behalf of yourself and your heirs,
legatees, personal representatives and assigns, hereby waive, release, discharge
and covenant not to bring any actions, claims, charges, liabilities,
obligations, fees, or suits of any kind against Leapnet (including shareholders,
employee benefit plans, trustees, fiduciaries and agents), which you have, have
had or may have through the date of this Agreement, whether known or unknown, by
reason of any matter, cause or thing, including but not limited to all claims
arising out of or relating in any way to your employment with Leapnet,
membership on the Board of Directors of Leapnet, Inc., or your position as
Chairman of the Board, or your separation from such employment, board membership
or chairmanship, including, but not limited to, all claims under Title VII of
the Civil Rights Act of 1964, as amended, 42 U.S.C. (S)(S) 2000e et seq.; the
Age Discrimination in Employment Act of 1967, 29 U.S.C. (S)(S) 621 et seq.; the
Fair Labor Standards Act, 29 U.S.C. (S)(S) 201 et seq.; the Americans with
Disabilities Act of 1990, 42 U.S.C. (S)(S) 12101 et seq.; the Family and Medical
Leave Act of 1993, 29 U.S.C. (S)(S) 2601 et seq.; the Employee Retirement Income
Security Act of 1974, 29 U.S.C. (S)(S) 1001 et seq.; and any other federal,
state, county or local statute, ordinance, regulation or order, and all claims
under the common law in tort, contract or otherwise.  This release expressly
includes all claims that could have been raised in state or federal court or
with a municipal, county, state or federal agency or entity of any kind or
jurisdiction.  This release also includes all claims for attorneys' fees and any
other remedy that could have been sought in connection with any of the released
claims.

     Excluded from this release are any claims that cannot be waived by law,
including but not limited to the right to file a charge with, or participate in
an investigation conducted by, certain government agencies.  You are waiving,
however, your right to any monetary recovery should any agency (including, but
not limited to, the Equal Employment Opportunity Commission) pursue any claims
on your behalf.

     4.  Opportunity to Employ Counsel.  Among the claims being released by you
         -----------------------------
in Paragraph 3 are claims under the Age Discrimination in Employment Act of
1967, as amended ("ADEA"), 29 U.S.C. (S) 621 et seq.  Pursuant to and in
compliance with the Older Workers Benefit Protection Act ("OWBPA"), 29 U.S.C.
(S) 626(f)(1)(H), you acknowledge that: you have had sufficient opportunity to
secure the services of a privately-retained attorney of your free choice, who is
an experienced lawyer familiar with the rights you waive herein; that you
understand the terms, obligations and rights you are releasing under this
Agreement; that you have had sufficient time to consider this Agreement before
signing it; that you know and understand the rights you are waiving and the
terms and consequences of your signature on this

                                       2
<PAGE>

Agreement; that you sign this Agreement knowingly, voluntarily, in good faith,
with a genuine intent to waive the rights identified herein; and that you have
not been subjected to any duress, coercion, fraud, overreaching, exploitation or
pressure to sign it. In addition, you acknowledge that you have had 21 days
within which to consult with an attorney prior to executing this Agreement, that
you have been given 7 days following your execution of the Agreement (the
"Revocation Period") to revoke this Agreement, and that this Agreement will not
become final until the Revocation Period has expired. Lastly, you acknowledge
that you are not otherwise entitled to the Separation Payment, Company-paid
health care benefits or Company-paid life insurance premiums described in
Paragraph 2.

     You may revoke the Agreement during the Revocation Period only by
delivering a written notice of revocation to: Rob Figliulo, Vice Chairman and
Chief Executive Officer, Leapnet, Inc., 2015 Spring Road, Suite 750, Oak Brook,
Illinois, 60523.  Such notice must be received by Leapnet within the Revocation
Period.

     5.  Restrictive Covenants.  You acknowledge and agree that the restrictive
         ---------------------
covenants set forth in Paragraph 9 of your Employment Agreement survive your
separation from employment and service with Leapnet, and the Effective Date of
this Agreement, and that such restrictive covenants will remain in full force
and effect in accordance with the Employment Agreement, other than as provided
in this Paragraph 5. You acknowledge and agree that it is essential to the
protection of Leapnet's goodwill and the maintenance of Leapnet's competitive
position that certain restrictive covenants in Paragraph 9 of your Employment
Agreement be expanded to take into consideration the fact that the scope of
Leapnet's business broadened after its recent acquisition of SPR, Inc.
Therefore, you agree as follows:

     A.  Expanded Definition of "Confidential Information".  The definition of
         -------------------------------------------------
"Confidential Information" set forth in Paragraph 9(a) of the Employment
Agreement is hereby expanded to include, but not be limited to:  marketing and
financial plans and strategies, market surveys and analyses; employer and
customer technical information; financial statements, personnel records and
payroll data; private and confidential discussions, including discussions of the
boards of directors; plans and strategies for new services and product
development; contracts with customers, suppliers and others; business
opportunities, capital financing; litigation; lists of customers and potential
customers; promotional materials, internal operating reports; employee and
potential employee names and addresses; account projections; customer strategy
information; marketing information and employment manuals; billing reports and
pricing information; management methods and systems; client correspondence;
resumes of existing and potential employees; customer bids and proposals; client
systems documentation; and other confidential and sensitive information.  You
acknowledge and agree that any use or disclosure of Confidential Information
would cause Leapnet irreparable harm, and that you must protect Leapnet's
Confidential Information indefinitely.

     B.  Expanded Non-Competition Promise.  In addition to the promises
         --------------------------------
contained in Paragraph 9(c) of your Employment Agreement, you hereby agree that
for a period of 12 months after the Effective Date, you will not, directly or
indirectly, engage in the business of, or own or control an interest in (except
as a passive investor owning less than 5% of the equity securities of any
company listed on a national securities exchange or traded over the counter), or
act as director, officer or employee of, or consultant to, any individual,
partnership, joint venture, corporation or other business entity directly or
indirectly engaged in Leapnet Business.  For purposes of this paragraph,
"Leapnet Business" means a service business engaged

                                       3
<PAGE>

in any of the following: (i) the development, renovation, implementation or
maintenance of Web sites, e-business architecture or computer programs; (ii) the
development of Internet-based business solutions or creation of storage,
interactive brand advertising or marketing; or (iii) the provision of e-business
consulting services or systems integration.

     C.  Expanded Non-Solicitation Promise.  In addition to the promises
         ---------------------------------
contained in Paragraph 9(d) of your Employment Agreement, you hereby agree that
for a period of 12 months after the Effective Date, you will not hire, cause to
be hired, solicit, or endeavor to entice away or divert from Leapnet any
officer, agent, consultant, independent contractor or supplier of  Leapnet to
discontinue such affiliation with Leapnet or to refrain from entering into new
business relationships with Leapnet.  Notwithstanding the foregoing, if any
officer, employee, agent, consultant, independent contractor or supplier of
Leapnet is contacted by, or receives a general communication or solicitation
directed to the general public from, an entity with which you have become
employed or otherwise affiliated, the parties hereto agree that such contact or
communication will not violate this provision unless you directly or indirectly
initiated it.  Leapnet's clients are third-party beneficiaries of this covenant
and shall have standing to enforce the terms of this paragraph, and to seek and
obtain whatever equitable or legal remedies are necessary to make them whole,
including but not limited to all remedies provided to Leapnet under the
Employment Agreement or this Agreement.  This covenant applies to the 25 clients
that paid the most money to Leapnet for products or services during the 12-month
period of time prior to the Effective Date, and 10 prospective clients with
which Leapnet actively pursued sales of products or services during the 12-month
period prior to the Effective Date.  The 25 clients and the top 10 prospective
clients will be identified by Leapnet within 15 business days after the
Effective Date.

     6.  Breach of Agreement.  In the event of an actual or threatened breach of
         -------------------
this Agreement, or of the Employment Agreement, you acknowledge and agree that
Leapnet may seek to enforce the terms of this Agreement or the Employment
Agreement in a court of law or equity and that the remedy at law or equity for
any breach will be inadequate.  Therefore, Leapnet will be entitled, in addition
to any other remedy at law or equity, to injunctive relief.

     7.  Cooperation with Leapnet.  You agree to render assistance and
         ------------------------
cooperation to Leapnet at its request regarding any matter, dispute or
controversy with which Leapnet may become involved and of which you have or may
have reason to have knowledge, information or expertise.  Such services will be
rendered by you for the 12-month period following the Effective Date for
reasonable compensation and subject to your reasonable availability.

     8.  No Admissions.  This Agreement results from a mutual decision and does
         -------------
not constitute an admission by you or Leapnet of any violation of any federal,
state or local law, statute, ordinance or regulation, or of any contract
(including your Employment Agreement), whether written or oral.

     9.  Amendment or Termination of Agreement.  This Agreement may be amended
         -------------------------------------
at any time by written agreement between you and Leapnet.  This Agreement will
remain in full force and effect until terminated upon our mutual consent in
writing.

     10.  Entire Agreement/Severability.  This Agreement sets forth the entire
          -----------------------------
agreement between you and Leapnet with respect to the subject matter hereof and
supercedes any and all other agreements (excluding paragraphs 9 and 10 of the
Employment Agreement), either oral or

                                       4
<PAGE>

written, between you and Leapnet with respect to the subject matter hereof. You
and Leapnet agree that if any provision of this Agreement or application thereof
is held to be invalid, the invalidity shall not affect other valid provisions or
application of this Agreement, which will remain binding upon the parties. In
the event that any covenant of this Agreement or the Employment Agreement is
determined by a court of competent jurisdiction to be overly broad, thereby
making the covenant unenforceable, you and Leapnet agree and desire that such
court will substitute a judicially enforceable limitation in its place, and that
as so modified the covenant will be binding upon you and Leapnet as if
originally set forth herein.

     11.  No Waiver.  No failure or delay by Leapnet or you in enforcing or
          ---------
exercising any right or remedy hereunder will operate as a waiver hereof.  No
modification, amendment or waiver of this Agreement nor consent to any departure
by you from any of the terms or conditions hereof, will be effective unless in
writing and signed by an authorized officer of Leapnet, Inc.  Any such waiver or
consent will be effective only in the specific instance and for the purpose for
which it was given.

     12.  Successors and Assigns.  All provisions of this Agreement will inure
          ----------------------
to the benefit of and be enforceable by your personal and legal representatives,
executors, administrators and heirs, and the successors and assigns of Leapnet.

     13.  Governing Law.  This Agreement will be governed by, and construed,
          -------------
interpreted and enforced in accordance with the laws of the State of Illinois,
exclusive of the conflicts of laws provisions.


     The parties to this Agreement have each signed this Agreement on the date
below their respective signature lines.

FREDERICK A. SMITH:                  LEAPNET, INC.


/s/ Frederick A. Smith               By:  /s/ Robert M. Figliulo
------------------------                  ------------------------------
                                     Its: Vice Chairman and CEO

Date:      11-17    , 2000           Date:  November 17, 2000
       -------------                        ------------

                                       5