Mr. Richard W. Gross
Interpool, Inc.
211 College Road East
Princeton, New Jersey 08540
RE: Cancellation of Stock Appreciation Rights
Dear Mr. Gross:
This letter agreement (this “ Agreement ”)
confirms the agreement between Interpool, Inc. (the “
Company ”) and you to cancel the stock appreciation
rights (the “ SARs ”) granted to you pursuant to
Section 6(e) of your employment agreement with the Company, dated
as of July 1, 2004 (the “ Employment Agreement
”), in exchange for the grant of a stock option under the
2004 Stock Option Plan for Key Employees and Directors of
Interpool, Inc. (the “ 2004 Stock Option Plan ”)
and payments of cash to be made by the Company in the future.
1.
Capitalized Terms . All capitalized terms not otherwise
defined herein shall have the meaning as set forth in the
Employment Agreement.
2. Term .
This Agreement shall be effective as of November 18, 2005 (the
“ Effective Date ”) and shall continue in effect
until each “Cash Payment” (as set forth in Paragraph 4
below) has been paid to you.
3.
Cancellation of Stock Appreciation Rights . You hereby agree
to the cancellation of the SARs effective as of the Effective Date,
in exchange for the Cash Payments and the “Option” (as
set forth in Paragraph 5 below) (the “ SARs
Cancellation ”). In addition, you hereby agree that
Section 6(e) of the Employment Agreement is superseded by the terms
of this Agreement, and that effective as of the Effective Date,
Section 6(e) of the Employment Agreement shall be deleted and of no
further force or effect.
4. Cash
Payments . You shall be entitled to receive the following lump
sum cash payments: (i) on or prior to December 31, 2005, an amount
equal to the estimated amount of income and employment taxes
expected to be imposed upon you for calendar year 2005 in
connection with the SARs Cancellation (the “ Tax
Payment ”); and (ii) on or prior to June 30, 2006, an
amount equal to (A) $472,000.00, minus (B) the amount of the Tax
Payment, to the extent it has already been paid to you (together
with the Tax Payment, the “ Cash Payments
”).
Notwithstanding the foregoing,
if prior to the payment of a Cash Payment, any of the following
events shall occur, you shall become entitled to receive the Cash
Payment as soon as practicable after the occurrence of such event:
(i) your employment with the Company is terminated by the Company
without Cause, by you for Good Reason, or due to your Disability or
death; (ii) a Going Private Transaction, provided you are employed
by the Company as of the effective date of such Going Private
Transaction; or (iii) a Change of Control, provided you are
employed by the Company as of the effective date of such Change of
Control.
5. Stock
Option . In addition, effective as of the Effective Date, you
shall be granted a nonqualified stock opt
