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Exhibit 10.2
SEPARATION AGREEMENT AND MUTUAL GENERAL
RELEASE
This Separation Agreement and Mutual General
Release (this "Agreement") dated as of December 7, 2006, is by and
between Martha D. Rehm (the
"EXECUTIVE") and VAIL RESORTS, INC.,
a Delaware corporation ("VAIL RESORTS"). The
EXECUTIVE and VAIL RESORTS may each be referred to as a "Party" and
collectively as the "Parties."
WHEREAS, the EXECUTIVE is the EXECUTIVE VICE
PRESIDENT, GENERAL COUNSEL AND SECRETARY of VAIL RESORTS;
and
WHEREAS, the EXECUTIVE and VAIL RESORTS agree
that as of the EXECUTIVE’S Final Date of Employment, as
hereinafter defined, the EXECUTIVE will no longer perform services
as an employee of VAIL RESORTS, and will cease to be eligible to
participate in benefit plans for active employees of VAIL RESORTS;
and
WHEREAS, the EXECUTIVE acknowledges that, as of
the Final Date of Employment, she has no entitlement to continued
pay or benefits under the Employment Agreement between the
EXECUTIVE and VAIL RESORTS, dated as of May 10, 1999, as amended
(the "Employment Agreement") except as provided herein;
and
WHEREAS, this Agreement is pursuant to Section
3(c) of the Employment Agreement, and the Parties mutually desire
to amend and supersede the Employment Agreement by this Agreement;
and
WHEREAS, VAIL RESORTS, wishes to pay the
EXECUTIVE the amounts set forth herein, less statutory and
authorized deductions;
In consideration of the mutual promises contained
in this Agreement, VAIL RESORTS and the EXECUTIVE agree as
follows:
1. As used
herein, the following terms, when capitalized, shall have the
following meanings:
(a) "Companies" shall mean VAIL RESORTS, INC. and all of its
subsidiaries and controlled affiliates.
(b) "Confidential Information" shall mean budgets, business plans,
financial projections, terms of transactions under consideration,
strategies, financial statements and results, plans or drawings,
lease terms, customer lists and information, prospect lists, club
membership rolls, trade secrets, information regarding legal
strategies and proceedings, and other information, whether in
tangible or electronic media format, pertaining to the business and
operations of the Companies. In addition, without in any way
limiting the foregoing, Confidential Information includes any and
all information in the EXECUTIVE’S possession or of which the
EXECUTIVE has knowledge relating to or arising out of any actual or
threatened regulatory investigation or proceeding or settlement or
any other litigation, claim, investigation, suit, action or other
proceeding involving or relating to the Companies, whether such
investigation, proceeding, settlement, claim, litigation, suit,
action or other proceeding or the EXECUTIVE’S knowledge
thereof occurred or was obtained during or prior to or after the
term of the EXECUTIVE’S employment by VAIL RESORTS.
Confidential Information does not include (i) any information
that is generally available to the public or hereafter becomes
available to the public without the fault of the EXECUTIVE;
(ii) club membership rolls sent to the EXECUTIVE in her
capacity as a member of the applicable club, provided that the
EXECUTIVE agrees that she will use such club membership rolls only
in accordance with the rules and regulations of the applicable
club; (iii) information that is or becomes known in the
industry without the fault of the EXECUTIVE; (iv) information
that is received from a third party outside of VAIL RESORTS which
to EXECUTIVE’S knowledge is not in violation of a
confidentiality agreement with VAIL RESORTS; or (v) general
industry skills, knowledge and experience.
(c) "Constituting Documents" shall mean the articles or
certificates of incorporation, bylaws, or similar organizational
documents for each of the Companies.
(d) "Final
Date of Employment" shall mean March 31, 2007, or such earlier date
as may be determined by VAIL RESORTS in its sole discretion;
provided that in the event that VAIL RESORTS elects to determine
that the Final Date of Employment shall occur before March 31,
2007, then VAIL RESORTS shall take all actions necessary to ensure
that such determination does not reduce or otherwise affect
EXECUTIVE’S rights under this agreement, her options to
purchase stock of VAIL RESORTS or other equity-based compensation
plans or agreements (provided that this Agreement shall not be
construed or applied so as to modify any stock option agreement or
plan so as to extend the period following the Final Date of
Employment that EXECUTIVE has the right to exercise any option to
purchase VAIL RESORTS stock beyond the period prescribed in such
stock option agreement and/or plan), including the right to and
amount of payments and other benefits to which EXECUTIVE is
entitled under Sections 3 and 4, below.
(e) "Legal
Proceeding" shall mean any claim, demand, pending or threatened
legal, regulatory or administrative proceeding and any other action
of any nature, whether known or unknown.
(f) "Released
Person" shall mean each of the Companies, and any of their current
and former officers, directors, employees, shareholders, partners,
members, agents, representatives, legal representatives,
accountants, and their successors and assigns.
2. The
employment relationship between the EXECUTIVE and VAIL RESORTS will
terminate on the Final Date of Employment. This Agreement
constitutes the EXECUTIVE’S resignation from all officer,
director and employee positions with VAIL RESORTS and the
Companies, in each case effective on the Final Date of Employment.
The Parties acknowledge that, following the Final Date of
Employment, the EXECUTIVE shall not be considered an officer or
employee of VAIL RESORTS.
3. In
consideration for the EXECUTIVE entering into this
Agreement,
(a) conditioned on: (i) the execution and non-revocation, pursuant
to Section 13 hereof, of this Agreement; and (ii) the
execution on the Final Date of Employment and non-revocation of a
mutual release, substantially in the form of the mutual release set
forth in Section 5 hereof, which mutual release shall be binding on
EXECUTIVE only if it is also executed and not revoked by VAIL
RESORTS, VAIL RESORTS
agrees to pay the
EXECUTIVE the sum of:
(w) $382,950, comprised of twelve (12) months of the
EXECUTIVE’S base salary; plus (x) $127,522, which is 66.6% of
EXECUTIVE’S full target bonus for the fiscal year started
August 1, 2006; plus (y) an amount equal to EXECUTIVE’S base
salary for the period, if any, from the Final Date of Employment
through March 31, 2007; and plus (z) $1,656, which is equal to the
amount of club membership dues payable by EXECUTIVE from the Final
Date of Employment through September 30, 2007 for the following
clubs: Beaver Creek Club, Red Sky Ranch Golf Club, and Bachelor
Gulch Club, less statutory and authorized deductions. Such sum will
be paid in a single lump sum six months after the Final Date of
Employment; provided that if guidance regarding Internal Revenue
Code Section 409A is issued that would permit such payment to be
made earlier without subjecting the EXECUTIVE to an additional
income tax, the EXECUTIVE may specify, on two business days’
prior notice, such an earlier payment date for the amounts set
forth in this Section 3(a). In addition, conditioned on: (i) the
execution and non-revocation, pursuant to Section 13 hereof, of
this Agreement; and (ii) the execution on the Final Date of
Employment and non-revocation of a mutual release, substantially in
the form of the mutual release set forth in Section 5 hereof, which
mutual release shall be binding on EXECUTIVE only if it is also
executed and not revoked by VAIL RESORTS,
VAIL RESORTS will also pay
COBRA health insurance premiums under its health insurance plans on
behalf of EXECUTIVE and her dependents for the period from the
Final Date of Employment through March 31, 2008.
(b) VAIL RESORTS agrees to pay the
EXECUTIVE, no later than 15 days after the Final Date of
Employment, full payment of any
amount owing to the EXECUTIVE in respect of
base
salary for the period
through the Final Date of Employment, as well as
accrued and unused paid time
off through such date (as reflected on the human resources records
of VAIL RESORTS) .
4. In addition
to that set forth in Section 3 above, the following shall be
applicable as a result of the EXECUTIVE’S
separation:
(a) After the Final
Date of Employment: (i) the EXECUTIVE shall neither accrue salary
nor paid time off nor participate in (A) VAIL RESORTS Medical
and Dental Plans (other than as required under COBRA),
(B) Short Term or Long Term Disability Insurance,
(C) VAIL RESORTS sponsored Life or ADD insurance programs, or
(D) any other compensation or benefit plans, programs or
arrangements maintained or contributed to by any of the Companies;
(ii) she shall have no right to make contributions or earn VAIL
RESORTS Matching Contributions in VAIL RESORTS’ 401(k) Plan
(except for any VAIL RESORTS Matching Contributions due but not yet
made: and (iii) except as otherwise provided in Sections 4(d) and
4(e) below, she shall no longer be entitled to any perquisites made
available to active executives or employees of VAIL RESORTS,
including, but not limited to parking or the use of VAIL RESORTS
owned and Volvo promotional vehicles. The EXECUTIVE’S rights
with respect to her accrued benefits, as of the Final Date of
Employment, under the Companies’ 401(k) Plan will be as set
forth in the applicable plan documents, and any conversion or
continuation right the EXECUTIVE may have under any other VAIL
CORPORATION sponsored employee benefit plan will be as set forth in
the applicable plan document and shall be at her sole expense.
Other than as expressly set forth in this Agreement, the EXECUTIVE
will have no rights to future benefits under any employee benefit
plan or arrangement of the Companies following the Final Date of
Employment, except to the extent such benefits have been earned and
accrued as of the Final Date of Employment.
(b) Any stock
options, restricted stock or other equity-based compensation awards
held by the EXECUTIVE that are not vested as of the
EXECUTIVE’S Final Date of Employment will be immediately
cancelled and forfeited.
(c) Notwithstanding anything in this or
another document to the contrary, all vested options to
purchase stock of VAIL RESORTS, INC. held by the EXECUTIVE after
the Final Date of Employment (each of which is listed on Annex A
hereto) shall thereafter continue to be exercisable in accordance
with their terms.
(d) For the period
through the end of the 2006-07 ski season the EXECUTIVE and a
single designated person living in the same household as EXECUTIVE
may continue to use their employee ski passes and, until March 15,
2007, receive discounts at SSV stores and restaurants, as they had
prior to the Final Date of Employment.
(e) Through
September 30, 2007, the EXECUTIVE shall retain membership
privileges in the following clubs: Beaver Creek Club, Red Sky Ranch
Golf Club, and Bachelor Gulch Club.
(f) For the period
through June 30, 2007, VAIL RESORTS shall maintain (i) an
appropriate forwarding message recorded by the EXECUTIVE and
approved by VAIL RESORTS on voicemail for the EXECUTIVE’S
former VAIL RESORTS telephone number, and (ii) an
auto-response on the email address mrehm@vailresorts.com with an
appropriate forwarding email response created by the EXECUTIVE and
approved by VAIL RESORTS. In addition, through June 30, 2007, VAIL
RESORTS shall forward to the EXECUTIVE, at an address she may
reasonably provide from time to time, any first class mail
addressed to the EXECUTIVE at VAIL RESORTS’ offices that VAIL
RESORTS determines is her personal mail.
(g) VAIL RESORTS
shall pay the EXECUTIVE’S reasonable legal fees incurred by
third-party counsel and expenses (not to exceed $7,500) incurred by
her in negotiating and executing this Agreement.
(h) VAIL RESORTS
shall reimburse the EXECUTIVE for reasonable expenses incurred by
her in the course of performing her duties with VAIL RESORTS prior
to the Final Date of Employment, so long as such expenses were
incurred in compliance with VAIL RESORTS’ policies with
respect to travel, entertainment and other business expenses, and
the EXECUTIVE has complied with VAIL RESORTS’ requirements
with respect to submitting, reporting and documentation of such
expenses.
5. (a) In
return for the consideration and other promises by VAIL RESORTS set
forth in this Agreement, the EXECUTIVE for herself and her
representatives, heirs, and assigns, hereby releases and discharges
each of the Released Persons from all Legal Proceedings, known or
unknown, that she may have against any of the Released Persons,
including, but not limited to, claims that in any manner relate to,
arise out of or involve any aspect of her employment with VAIL
RESORTS, and her separation from that employment, including, but
not limited to, any rights or claims under the Federal Worker
Adjustment and Restraining Notification Act, 29 U.S.C. §2101
et seq .; the Colorado Anti-Discrimination
Act, Colo. Rev. Stat. §21-34-401, et seq
.; the Family and Medical Leave Act, 29 U.S.C. &s
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