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EXECUTIVE EMPLOYMENT AND NONCOMPETITION AGREEMENT

NonCompetition Agreement

EXECUTIVE EMPLOYMENT AND NONCOMPETITION AGREEMENT | Document Parties: RSC EQUIPMENT RENTAL, INC. | RSC Equipment Rental, Inc | RSC Holdings Inc You are currently viewing:
This NonCompetition Agreement involves

RSC EQUIPMENT RENTAL, INC. | RSC Equipment Rental, Inc | RSC Holdings Inc

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Title: EXECUTIVE EMPLOYMENT AND NONCOMPETITION AGREEMENT
Governing Law: Arizona     Date: 9/27/2010

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Exhibit 10.1

EXECUTIVE EMPLOYMENT
AND NONCOMPETITION AGREEMENT

This Executive Employment and Noncompetition Agreement (“Agreement”) is entered into between RSC Holdings Inc. and RSC Equipment Rental, Inc. (the “Company” or “RSC”) and Patricia D. Chiodo (“Executive”), effective as of October 1, 2010 (the “Effective Date”).

RECITALS

WHEREAS, the Company operates its equipment rental business which has store locations throughout North America (such business as operated by the Company is referred to herein as the “Business”).

WHEREAS, the Company’s life-blood is its Confidential Information, including but not limited to customer databases, marketing and sales objectives and strategies, customer lists, information regarding existing customer preferences, habits, and needs, information regarding prospective customers, details of past, pending and contemplated transactions, price lists, pricing policies, sales data, training materials, and customer proposals, information developed about the Company’s competitors, systems, strategies, designs, processes, procedures, market data, know-how, compilations of technical and non-technical data, advertising and promotional plans, and financial and other projections, which information has been collected over a significant amount of time and at great effort and expense.

WHEREAS, the Company would be placed at an unfair competitive disadvantage if Executive were able to use the Company’s Confidential Information and goodwill for her own benefit, or for the benefit of anyone other than the Company.

WHEREAS, with the assurances contained in the agreement, the Company desires to employ Executive as a Senior Vice President, Chief Financial Officer, in which position she will not only have access to the Company’s Confidential Information but also will have the duty to expand and improve such information.

WHEREAS, Executive desires to be employed by the Company in this position and is willing to do so upon the terms contained herein.

AGREEMENT

NOW, THEREFORE, as a condition of employment, and for other good and valuable consideration, including without limitation continued employment and/or promotion or advancement, which Executive agrees is sufficient consideration for this Agreement, and in consideration of the mutual promises and covenants set forth below, the Company and Executive agree as follows:

 

 


 

ARTICLE I

EMPLOYMENT

Section 1.1 . Employment & Position . The Company shall employ Executive as Senior Vice President, Chief Financial Officer at the Company’s location in Scottsdale, AZ. Executive shall report to the President and Chief Executive Officer, and the Board of Directors of the Company. During Executive’s employment hereunder, Executive shall devote all necessary energies, experience, skills, abilities, knowledge and productive time to the performance of duties under this Agreement and shall not render to others services that interfere with the performance of her duties with the Company under this Agreement. The rendering of services to others shall be subject to the approval of the Board.

Section 1.2 . Duties . Executive will be responsible for the full range of responsibility customarily performed by an Executive in the position of Senior Vice President, Chief Financial Officer of the Company and render such services as are from time to time necessary or requested in connection with the affairs of the Company. Executive’s duties also includes the obligation to maintain the highest level of integrity and report and (when appropriate) address violations of the Company’s policies and procedures, and hereby acknowledges, represents and warrants that there are no such violations as of the date hereof.

Section 1.3 . Term of Employment . Executive shall be employed as herein set forth, commencing on the date set forth above and continuing until terminated by either party in accordance with section 2.5 below (the “Employment Term”).

ARTICLE II

COMPENSATION

Section 2.1 . Base Salary . Executive’s salary (the “Base Salary”) shall be three hundred sixty five thousand dollars ($365,000) per annum for the term of this Agreement and/or as increased, after review by the Board at the time and in accordance with Company policies as in effect from time to time. Base Salary shall be payable in accordance with the standard payroll practices of the Company.

Section 2.2 . Variable Compensation . In addition to her Base Salary, Executive will be eligible to receive Variable Compensation, in accordance with the Company’s Variable Compensation Plan as in effect from time to time, and which will provide her with additional incentive opportunity with a target of seventy-five percent (75%) of her Base Salary and a maximum of one-hundred fifty percent (150%) of her Base Salary.

Section 2.3 . Equity Incentive . Executive will be eligible to participate in the Company’s discretionary long term incentive plan during the course of employment with the Company, subject to the discretion of the Compensation Committee and/or the Board of Directors and the terms and conditions of the applicable plan. Awards will be determined utilizing the valuation methodology used for other similarly situated executive officers of the Company.

 

2


 

Section 2.4 . Other Benefits . During the Employment Term, Executive shall be entitled to all benefits and conditions of employment generally provided to other RSC Company executives, subject to the same eligibility and other reasonable conditions of Company benefit programs and to country related differences, including, but not limited to, medical, dental, life insurance, non-qualified deferred compensation programs, sick leave, disability, automobile allowance ($1,200 per month) and participation in any retirement plan. In addition, benefits shall include, but not be limited to five (5) weeks vacation per year and an annual tax and financial planning services allowance of up to two thousand five hundred dollars ($2,500).

Section 2.5 . Employment Separation .

(a)  Severance Benefits : The Company may, at its sole discretion, terminate Executive’s employment at any time, provided however, that if the Company severs Executive’s employment for any reason other than For Cause or if Executive terminates her employment for Good Reason the Company shall provide the following severance payments and benefits (collectively “Severance Benefits”), less all applicable federal and state income and withholding taxes, in exchange for a full and complete release of all claims against the Company, in the form customarily used by the Company, executed by Executive, and Executive allows such release to become effective:

 

1.

 

Eighteen (18) months of Base Salary (the “Severance Period”), plus a pro-rata portion of variable compensation for the calendar year, or if variable compensation is to be paid quarterly then for the calendar quarter, in which the severance occurs up to the separation date, such pro rata bonus to be equal to the variable compensation Executive would have earned had Executive remained employed through the end of the applicable period (pro rated based on the number of days employed in such period). Executive’s entitlement to and the amount of any variable compensation under this Section 2.5(a) (1) shall be determined at the sole discretion of the Company. The Base Salary shall be payable in accordance with the Company’s regular payroll practices, and the pro rata variable compensation payments shall be payable at the time that other variable compensation payments are made under the applicable Variable Compensation Plan. Notwithstanding the payment schedule described in this paragraph, if Executive is a Specified Employee (as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”)) and becomes entitled to the payment described in this Section 2.5 as a result of a separation of service as defined by Section 409A(a)(2)(i) of the Code, then the portion of such payment treated as “separation pay” for purposes of Section 409A shall not be paid prior to the date which is six (6) months after the date of the Executive’s separation of service with the Company if such payment would result in the imposition of an excise tax under Section 409A of the Code. Any amount described in the preceding sentence over the applicable threshold, that is otherwise payable during the first six months following Executive’s separation from service shall be accumulated and paid to Executive in a lump sum amount on the first date of the seventh month following the date of separation from service.

 

3


 

Executive’s entitlement to the foregoing severance payments is contingent on her continued compliance with the confidentiality, non-competition and non-solicitation provisions outlined in Sections 3.1, 3.2, 4.2 and 4.3 herein. Executive understands that if the Company determines that she has violated the confidentiality provisions, covenant not to compete or non-solicitation provisions, the Company will not make any further severance payments, and will be entitled to reimbursement from Executive of any severance amounts already paid to her, all in addition to any other remedy to which the Company may have.

 

2.

 

Upon her separation from service, if Executive is eligible and enrolled in the Company’s medical and dental benefit programs, the Company will provide the necessary forms, including COBRA notifications, to transfer the responsibility and right to continue those benefits to Executive, which under COBRA are typically at her expense, for the time period allowed by law or under the applicable programs. However, assuming Executive is eligible and elects to continue those benefits, the Company will continue to pay the same proportion of Executive’s medical and dental insurance premiums under COBRA as during active employment (for Executive and eligible dependents) until the earlier of: (1) the expiration of the Severance Period; or (2) the date Executive is eligible for medical and dental insurance benefits by another employer.

 

 

3.

 

Upon termination of employment, Executive is not eligible to continue participation in the Company group life insurance program. The Company will therefore pay, at the Company’s option, the premiums during the Severance Period that are either (i) applicable to a conversion of the coverage (equal to the amount normally provided to an employee without payment by the employee) from group to individual coverage; or (ii) that will support the same level of coverage in a term life policy. The company’s obligation under this sub-section is to provide the required insurance and Executive is not entitled to a cash payment in substitution thereof.

 

 

4.

 

The Company on the date of separation will provide professional outplacement counseling and services consistent with other Executives at similar compensation levels. No cash lump sum payment in lieu of outplacement services will be provided to Executive.

 

4


 

 

5.

 

During the eighteen (18) month period during which Severance Benefits under this Section 2.5 are paid, the Company will continue to pay for Executive’s reasonable and necessary association fees related to Executive’s duties and responsibilities as contemplated in Section 1.2, and only to the extent previously paid by the Company. However, the payment of the fees within this paragraph shall cease upon the earlier of: (1) the expiration of the Severance Period; or (2) the date Executive is employed whether consulting, self employed or employed by another employer.

 

 

6.

 

The Company may give the Executive 30 days’ prior written notice of termination of employment for the purposes of providing transition services. In the event the Company gives such notice, the Executive shall be under no obligation to render additional services and shall be allowed to seek other employment, provided that the Severance Period shall be reduced accordingly if Executive so ceases, for any re


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