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EXHIBIT 10(k)
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EMPLOYMENT AGREEMENT
AGREEMENT, dated February 28, 1997, between The Hertz Corporation, a
Delaware corporation (the "Corporation"), and Xxxxx X. Xxxx the "Executive").
WHEREAS, the Corporation currently employs the Executive in the
capacity of President and Chief Operating Officer and the Executive is a key
executive officer of the Corporation; and
WHEREAS, the Corporation desires that the Executive continue in the
employ of the Corporation in his present position, or other senior executive
position, and the Executive desires to continue to be so employed, and both
parties are willing to make a commitment to continue this employment
relationship for the term of this Agreement, as set forth in Section 2 hereof
(the "Term");
NOW, THEREFORE, in consideration of the mutual promises contained
herein and other good and valuable consideration, the parties hereby agree as
follows:
1. Employment.
The Corporation hereby agrees to continue to employ and engage the
services of the Executive during the Term as an executive officer of the
Corporation and the Executive agrees to serve the Corporation in such capacity
and position during the Term.
2. Term.
The Term shall consist of a period commencing on the date hereof and
ending on April 30, 2002; provided, however, that commencing May 1, 1998 and
every May 1 thereafter the Term shall be automatically extended for one (1)
additional year unless not later than December 31 of the preceding year the
Corporation or the Executive shall have given notice not to extend; provided,
further, that in no event shall the original or extended term of this Agreement
extend beyond the Executive's normal retirement date under
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the Corporation's retirement policies existing on the date hereof or under any
policy established for the Executive with his consent.
1. Position and Duties.
(a) At the present time, Executive is President and Chief Operating
Officer of the Corporation. During the Term, the Executive's position, duties
and responsibilities shall be those of a senior executive of the Corporation,
recognizing that, notwithstanding any provision of the Agreement to the
contrary, the Corporation shall have the absolute right to modify or change the
position, duties, responsibilities and title of the Executive in any respect;
provided, however, that the Executive shall continue to be employed in a senior
executive capacity during the Term.
(b) The Executive agrees to devote his full business time during
normal business hours to the business and affairs of the Corporation and to use
his best efforts to promote the interests of the Corporation and to perform
faithfully and efficiently the responsibilities assigned to him in accordance
with the terms of this Agreement, to the extent necessary to discharge such
responsibilities, except for (i) services on corporate, civic or charitable
boards or committees not significantly interfering with the performance of such
responsibilities and (ii) periods of vacation and sick leave to which he is
entitled. It is expressly understood and agreed that the Executive's continuing
service on any boards and committees with which he shall be connected, as a
member or otherwise, as of the date hereof, or any such service approved by the
Corporation during the term of employment, shall not be deemed to interfere
with the performance of the Executive's services for the Corporation pursuant
to this paragraph (b).
(c) During the Term and so long as any payments are being made under
Section 4 hereof, the Executive shall refrain from engaging in any activity
that is directly or indirectly in competition with any activity, or is inimical
to the bests interests, of the Corporation or any of its subsidiaries or
affiliates.
4. Compensation and Other Terms of Employment.
(a) Base Salary. During the Term, the Executive shall receive an
annual base salary ("Base Salary"), payable in equal installments not less
frequently than twice per month, at an annual rate at least
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equal to the aggregate annual base salary payable to the Executive by the
Corporation and any of its affiliated companies as of the date hereof. The Base
Salary shall be reviewed and may be increased at any time and from time to time
in accordance with the Corporation's regular practices. Any increase in the
Base Salary shall not serve to limit or reduce any other obligation of the
Corporation hereunder, and after any such increase the Base Salary shall not be
reduced from such increased level during the Term. As used in this Agreement,
the term "affiliated companies" shall mean any company (or other business
entity) controlling, controlled by, or under common control with the
Corporation.
(b) Incentive Compensation. As further compensation, the Executive
will be eligible for awards ("Incentive Compensation") under the Corporation's
bonus and incentive compensation plans determined on no less favorable a basis
than those provided to the Executive under such plans as in effect as of the
date hereof.
(c) Retirement, Savings and Stock Option Plans. In addition to
the Base Salary and Incentive Compensation payable as hereinabove provided,
during the Term the Executive shall be entitled to participate in all savings,
stock option, retirement and employee welfare and benefit plans and programs,
and fringe benefit, vacation, sick leave, insurance and perquisite policies, on
a basis providing him with the opportunity to receive aggregate compensation
and benefits, on a before-tax basis, not less favorable than those provided by
the Corporation and its affiliated companies to the Executive under such plans,
programs and policies as in effect as of the date hereof. Nothing herein shall
be construed to prevent the Corporation or such affiliated companies from
amending or altering any such plans or programs so long as the Executive
continues to have the opportunity to receive aggregate compensation and
benefits, on a before tax basis, at a level not less favorable than those
currently provided. All existing agreements between the Corporation and the
Executive providing for special pension, retirement or similar benefits are
automatically continued for the Term. Any rights to benefits which become
vested under the terms of such plans, programs, policies and agreements but
which are to be paid or provided in future periods shall continue to be so
vested notwithstanding the prior termination of this Agreement.
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(d) Expenses. During the Term the Executive shall be entitled to
receive prompt reimbursement for all reasonable expenses incurred by the
Executive in accordance with the policies and procedures of the Corporation in
effect as of the date hereof or as they may be amended from time to time.
(e) Office and support Staff. During the Term the Executive shall
be entitled to an office or offices of a size and with furnishings and other
appointments, and to secretarial and other assistance, at least equal to those
provided to the Executive as of the date hereof.
5. Termination.
(a) Death. Except for the obligations of the Corporation set forth
in Section 4(c) hereof, this Agreement shall terminate automatically upon the
Executive's death. All benefits and compensation then accrued hereunder, and
under any plans provided for under Section 4(c) hereof, shall be paid to the
Executive's beneficiaries, legal representatives, or heirs as appropriate.
(b) Disability. If, as a result of the Executive's incapacity due
to physical or mental illness the Executive shall have been absent from the
full-time performance of his duties with the Corporation for six (6)
consecutive months, and within thirty (30) days after written notice of
termination is given the Executive shall not have returned to the full-time
performance of his duties, the Executive's employment may be terminated for
disability. During such period of absence, the Executive shall continue to
receive the benefits provided in Section 4 hereof and thereafter the
Executive's benefits shall be determined under the Corporation's disability
insurance plans and policies provided under Section 4(c) hereof.
(c) Cause. The Corporation may terminate the Executive's
employment for Cause. For purposes of this Agreement, "Cause" shall mean (i) an
act or acts of dishonesty on the Executive's part which are intended to result
in his substantial personal enrichment at the expense of the Corporation or
the Executive's conviction of a felony; (ii) any material violation by the
Executive of his responsibilities set forth in Section 3 hereof; or (iii) any
material breach of any provision of this agreement by Executive. If the
Executive's employment is terminated for Cause, the Corporation shall pay the
Executive his full accrued Base Salary through the date of such termination at
the rate in effect at the time of such termination, and the Corporation shall
have no further obligations to the Executive under this Agreement. The
Executive's employment shall
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not be terminated for Cause unless there shall have been delivered to the
Executive a resolution duly adopted by the Board of Directors of the
Corporation at a meeting of the Board which the Executive, together with his
counsel, has an opportunity upon reasonable notice to attend and to address the
Board, such resolution setting forth with particularity the basis for
terminating the Executive for Cause.
(d) Retirement. The Executive may terminate his employment
hereunder by retirement, including early retirement, during the Term of the
Agreement, under the Corporation's retirement policies existing on the date
hereof or under any policy established for the Executive with his consent,
provided that the Corporation consents to such retirement action.
6. Non-exclusivity of Rights.
Nothing in this Agreement shall prevent or limit the Executive's
continuing or future participation in any benefit, bonus, incentive or other
plan or program provided by the Corporation or any of its affiliated companies
and for which the Executive may qualify, nor shall anything herein limit or
otherwise affect such rights as the Executive may have under any stock option
or other agreements with the Corporation or any of its affiliated companies,
unless this Agreement is terminated for breach of the provisions contained in
Section 3(c) hereof. Amounts which are vested benefits under any plan or
program of the Corporation or any of its affiliated companies shall be payable
in accordance with the terms of such plan or program.
7. No Set-Off; Legal Fees.
The Corporation's obligation to make the payments provided for
herein and otherwise to perform its obligations hereunder shall not be affected
by any circumstances, including without limitation any set-off, counterclaim,
recoupment, defense or other right which the Corporation may have against the
Executive or others unless this Agreement is terminated for cause for breach of
the conditions set forth in Section 3(c) hereof. Unless it is finally
determined by a court of competent jurisdiction that the Corporation has
validly terminated the Executive's employment for Cause, the Corporation agrees
to pay, to the full extent permitted by law, all legal fees and expenses which
the Executive may reasonably incur in defending any contest by the Corporation
or others of the validity or enforceability of, or liability under, any
provision of this Agreement, plus interest on the total unpaid amount
determined to be payable hereunder, for the period commencing on
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the date of such contest and ending on the date on which the Corporation shall
pay such total amount, provided Executive prevails in such contest.
8. Receipt of Certain Benefits.
It is the mutual intention of the Corporation and the Executive
that the Executive shall receive the full benefit of those compensation
plans and programs of the Corporation, including its retirement and pension
plans and programs, being provided pursuant to Section 4 hereof which provide
for benefits payable over periods beyond the particular year of employment
("Long-Term Plans"). Accordingly, the parties intend that, in the event of any
breach by the Corporation of the terms hereof, damages for such breach shall
include consequential damages for the loss of any benefits under such Long-Term
Plans, which benefits would have become payable under such plans had the
Executive completed the Term remaining at the time of such breach but which are
not payable under such plans by reason of such breach.
9. Confidential Information.
The Executive shall hold in a fiduciary capacity for the benefit of
the Corporation all secret or confidential information, knowledge or data
relating to the Corporation, Ford Motor Company, or any of their subsidiaries
or affiliates, and their respective businesses, which shall have been obtained
by the Executive during his employment by the Corporation or any of its
affiliated companies and which shall not be public knowledge. During and
after the end of the term of employment, the Executive shall not, without the
prior written consent of the Corporation, communicate or divulge any such
information, knowledge or data to anyone other than the Corporation and those
designated by it.
10. No Assignment; Assumption.
This Agreement is personal to the Executive and without the prior
written consent of the Corporation shall not be assignable by the Executive
other than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive's legal
representatives. This Agreement shall be binding upon any successor to the
business or assets of the Corporation which assumes this Agreement expressly,
by operation of law or otherwise.
11. Miscellaneous.
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(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, without reference to principles of
conflict of laws. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not be amended or
modified other than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.
(b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:
If to the Executive:
00 Xxxxxxx Xxxxx
Xxx Xxxxxx, Xxx Xxxxxx 00000
If to the Corporation:
000 Xxxx Xxxxxxxxx
Xxxx Xxxxx, Xxx Xxxxxx 00000
Attention: General Counsel
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
(d) The Corporation may withhold from any amounts payable under
this Agreement such federal, state or local taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
1. Integration and Supersession.
This Agreement contains the entire understanding of the parties
hereto with respect to the subject matter hereof. Upon execution by both
parties, this Agreement shall supersede and replace all prior
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agreements, understandings and communications on this subject matter, including
an Employment Agreement dated April 16, 1987 between The Hertz Corporation and
Xxxxx X. Xxxx; and an Amendment to Employment Agreement, dated December 30,
1987, between The Hertz Corporation and Xxxxx X. Xxxx.
IN WITNESS WHEREOF, the Corporation has caused this Agreement
to be signed in its corporate name and its corporate seal to be hereunto
affixed and to be attested by its Secretary or one of its Assistant
Secretaries, and the Executive has hereunto set his hand, all as of the day and
year first above written.
/s/ Xxxxx X. Xxxx
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Executive
THE HERTZ CORPORATION
By /s/ Xxxxxx X. Xxxxxx
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Its Senior Vice President, Employee Relations
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ATTEST:
/s/ Xxxx X. Xxxxxxxxxx
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Asst. Secretary
(Seal)
