Exhibit 10.1
SEPARATION AGREEMENT
and
GENERAL RELEASE OF ALL CLAIMS
This Separation Agreement and General Release
of All Claims (“Agreement”) is entered into by and
between Paul Siracusa (hereinafter “Siracusa” or
“Employee”), Hertz Global Holdings, Inc. and The Hertz
Corporation (hereinafter “Hertz” or “the
Companies”), duly acting under authority of its officers and
directors.
WHEREAS ,
Siracusa’s employment with Hertz will end effective August
31, 2007 and;
WHEREAS, Siracusa
and the Companies acknowledge the existence and enforceability of a
Change In Control Agreement (“C.I.C. Agreement”)
entered into by Siracusa and The Hertz Corporation in or around
July 2005 and the applicability of the terms of that Agreement to
the separation of Siracusa’s employment; and
WHEREAS , Siracusa
is the holder of options to purchase common stock of Hertz Global
Holdings, Inc. (each, an “Option”);
WHEREAS,
Siracusa’s separation of employment with Hertz occurred per
the terms of the C.I.C. Agreement as a resignation of Siracusa
“For Good Reason,” and consequently, Siracusa is
entitled to all of the benefits of the C.I.C. Agreement since the
resignation is occurring within the “Protected Period”
under that Agreement.
WHEREAS, the
Siracusa’s separation from employment would have the effect
of terminating all unvested stock options pursuant to the Hertz
Global Holdings, Inc. Stock Incentive Plan; and
1
WHEREAS, the
parties desire to resolve any disputes, claims or controversies
that have arisen or may arise in regard to Siracusa’s
employment and subsequent separation from the Companies;
NOW, THEREFORE , in
consideration of the mutual promises, covenants and agreements
stated herein, which Siracusa and the Companies agree constitutes
further good and valuable consideration beyond that which is
provided for in the Change In Control Agreement, receipt of which
is acknowledged herein, the parties stipulate and do mutually agree
as follows:
1.
Upon the date (the “Early Vesting Date”) that is the
later to occur of (x) the Effective Date of this Agreement (as
defined below) and (y) August 31, 2007, those of Siracusa’s
Options that would have vested in May 2008 or May 2009 shall
vest. Siracusa understands and agrees that such Options would
not normally have vested until May 2008 and May 2009, respectively,
and then only if Siracusa was employed by the Company at those
times. It is further agreed that the ending of
Siracusa’s employment as provided herein shall be deemed a
“retirement from active service on or after the Employee
reaches normal retirement age” for purposes of Section 3(b)
of the option agreements governing all Options that vested on or
before the Early Vesting Date, as a result of which such vested
Options (that is, the options vested in May 2007 and the options
that will vest pursuant to this Section 1) shall be exercisable for
a period of 180 days following the expiration of the “Lock Up
Period” as defined in the Lock Up Agreement delivered
by Siracusa to Goldman, Sachs & Co., Lehman Brothers, Inc
and Merrill Lynch, Pierce, Fenner and Smith Incorporated, as
representatives of the underwriters of the June 2007 secondary
public offering of Hertz Holdings’ common stock; following
the end of such 180 day period, any such Options remaining
unexercised shall be cancelled.
2
The
parties agree that the combined Options referenced which will vest
per the terms of this Agreement are as follows: Two Hundred
Thousand (200,000) Options constituting the cumulative
of the 20% to have been vested in May 2008 and the additional 20%
to have been vested in May 2009 at the strike price of $4.56;
Eighty Thousand (80,000) Options constituting the cumulative of the
20% to have been vested in May 2008 and the additional 20% to have
been vested in May 2009 at the strike price of $9.56; and Eighty
Thousand Options (80,000) constituting the cumulative of the 20% to
have been vested in May 2008 and the additional 20% to have been
vested in May 2009 at the strike price of $14.56. The
parties also agree that at the time of notification of
Siracusa’s resignation, the stock was trading at over $22.00
per share. Any other unvested Options held by Siracusa other
than those that were to vest in May 2008 and May 2009 shall be
governed by the terms of the individual stock option agreements
evidencing the award of such Options and be canceled.
2.
Section 5.1(a) of the C.I.C. Agreement shall be modified and
amended to provide that Siracusa shall receive his full bonus for
calendar year 2007, specifically the sum of $382,200.00, no later
than 30 days following August 31, 2007, the agreed upon date of his
termination. Such sum will be used in computing
Siracusa’s 2007 salary and bonus for purposes of determining
his pension benefits.
3.
Pursuant to Section 5.1(b) of the C.I.C. Agreement, the Company
shall pay Siracusa the amount of $2,869,707.00, less deductions
required by law, no later than 30 days following August 31,
2007.
4.
Section 5.1(c) of the C.I.C. Agreement shall be modified and
amended to provide that Siracusa will receive the standard LTIP
payments for 2007 ($300,000.00) and 2008 ($340,000.00) and such
payments shall be made no later than 30 days following August 31,
2007.
3
5.
The first sentence of Section 5.1(e)(i) of the C.I.C. Agreement
shall be modified and amended to provide the following:
“Through July 17, 2012, the Employer shall maintain in full
force and effect (or otherwise provide) with respect to the
Executive and Executive’s spouse, all health benefits upon
the same terms and to the same extent that the benefits were in
effect, immediately prior to the Termination
Date.”
6.
Section 5(g) of the C.I.C. Agreement shall be modified and amended
to provide that “Executive shall, no later than 30 days
following August 31, 2007, receive the sum of $25,000.00 to
use for outplacement assistance or in any other manner as Executive
sees fit.”
7.
Section 8 of the C.I.C. Agreement shall be null and
void.
8.
The Company desires that Siracusa be available to generally answer
questions, assist the new CFO and Controller, and to otherwise
maintain management continuity during the one year period following
Siracusa’s resignation. Accordingly, they shall enter
into a consulting agreement, commencing September 1, 2007,
providing, inter alia , that Siracusa will be paid the
sum of $120,000.00, less deductions required by law. Siracusa
shall invoice the Company on a monthly basis in equal
installments. During the consulting period, Siracusa shall be
available for up to twenty hours on average per month at times
mutually convenient for the parties, to provide such consulting
services. Additionally, the Company shall pay Siracusa pre-approved
expenses incurred in connection with such consulting
services.
9.
In exchange for receiving all of the benefits described above,
Siracusa does for himself and his heirs, executors, administrators,
successors, and assigns, hereby release, acquit, and forever
discharge and hold harmless the Companies and its divisions,
subsidiaries, affiliated companies, successors, assigns, officers,
directors, shareholders, employees, benefit and
4
retirement plans (as
well as trustees and administrators thereof), agents and heirs,
assigns and successors, past and present, of and from any and all
actions, causes of action, claims, demands, attorneys’ fees,
compensation, expenses, promises, covenants, and damages of
whatever kind or nature, in law or in equity, which Siracusa has,
had or could have asserted, known or unknown, at common law or
under any statute, rule, regulation, order or law, whether federal,
state or local, or on any grounds whatsoever, including without
limitation; · any and all claims for any additional severance
pay, vacation pay, bonus or other compensation; any and all
claims of discrimination or harassment based on race, color,
national origin, ancestry, religion, marital status, sex, sexual
orientation, disability, handicap, age or other unlawful
discrimination; any claim regarding the interpretation or
enforcement of Section 3 of the C.I.C. Agreement; any claims
arising under Title VII of the Federal Civil Rights Act; the
Federal Civil Rights Act of 1991; the Americans with
Disabilities Act; the Age Discrimination in Employment
Act; the New Jersey Law Against Discrimination; or under any
other state, federal, local or common law, with respect to any
event, matter, claim, damage or injury arising out of his
employment relationship with the Companies, and/or the separation
of such employment relationship, and/or with respect to any other
claim, matter, or event, fro
