LegalHuman Capital
The Kill Switch
Also known as: Employment kill switch, termination cascade, employment weapon
TO-original framework. The employment agreement governs every dollar still on the table. For-cause termination triggers cascade across equity, deferred payments, and restrictive covenants — making the threat as powerful as the action.
WHY IT MATTERS
Introduced in D.14 (Your Employment Agreement Is the Most Dangerous Document in the Deal). The employment agreement doesn't just govern the founder's job. It governs every dollar still on the table. For-cause termination isn't a personnel action — it's a financial weapon. The buyer doesn't need to fire the founder. They just need the founder to know they can. In the Crossfield deal, James deleted a memo objecting to revenue redirection because his attorney warned that a written disagreement with board strategy could be characterized as 'conduct detrimental to the company's interests' — enough to trigger for-cause under his employment agreement.