Dell's Ex-CEO To Get $5 Million Severance

Dell will give its former CEO Kevin Rollins, who quit under pressure last month, a $5 million payout as he leaves the company, according to this 8-K filing with the U.S. Securities and Exchange Commission:

The Separation Agreements provide that Mr. Rollins will receive a cash severance payment of $5 million to be paid in five equal installments between May 4, 2007 and April 15, 2008. In the Separation Agreements, Mr. Rollins provided a general release of claims against the company and agreed to certain noncompetition and nonsolicitation obligations for a period of 12 months following his termination of employment. The Separation Agreements were approved by the company's board of directors.

Until May 4, Dell said, Rollins will still be paid full salary as an "advisor" to the company. The agreement itself includes a non-compete.

Paragraph 7 of the deal comes with this language, as well:

Mr. Rollins agrees that he will give Dell his full cooperation in connection with any claims, lawsuits, or proceedings that relate in any manner to Mr. Rollins' conduct or duties at Dell or that are based on facts about which Mr. Rollins obtained personal knowledge while employed at Dell. In return, Dell agrees to continue to provide legal counsel on Mr. Rollins behalf and to reimburse Mr. Rollins for his direct and reasonable out of pocket expenses (including reasonable attorney's fees) incurred with respect to rendering such cooperation. Mr. Rollins further agrees that he will not voluntarily become a party to, or directly or indirectly aid or encourage any other party in connection with, any lawsuit, claim, demand, or adversarial or investigatory proceeding of any kind involving Dell or any of the Released Parties that relates in any material way to his employment with Dell or that is based on facts about which Mr. Rollins obtained personal knowledge while employed with Dell. Mr. Rollins compliance with a subpoena or other legally compulsive process will not be a violation of this provision.

Dell currently faces at least two shareholder class action lawsuits, and is under investigation by the SEC and the U.S. Attorney for the Southern District of New York. The federal investigators are looking into the possibility that Dell misstated its financial results and other accounting issues.

The separation deal also requires that Rollins, essentially, say nothing publicly that would disparage his old company.

His $5 million severance will be paid in five, equal installments between May 4 and April 15, 2008.