EXHIBIT 10.3
EXECUTION COPY
EMPLOYMENT AGREEMENT
     EMPLOYMENT AGREEMENT (“Agreement”) dated as of November 30, 2006 by and
between GMAC LLC (the “Company”) and William Muir (the “Executive”) (each a
“Party” and together, the “Parties”).
     WHEREAS, the Executive has been employed by General Motors Acceptance
Corporation (“GMAC”) as President, GMAC and Chairman, GMAC Insurance Group;
     WHEREAS, a Purchase and Sale Agreement, dated as of April 2, 2006, was
entered into between FIM Holdings LLC (“Holdings”), GMAC, General Motors
Corporation, and the other parties thereto (the “Purchase Agreement”);
     WHEREAS, prior to the Closing Date (as defined in the Purchase Agreement),
GMAC shall be converted into the Company;
     WHEREAS, the Parties desire the Executive to continue employment with the
Company upon the terms set forth herein.
     Accordingly, the Parties agree as follows:
     1. Employment and Acceptance. The Company shall employ the Executive, and
the Executive shall accept employment, subject to the terms of this Agreement,
on the Closing Date (the “Effective Date”).
     2. Term. Subject to earlier termination pursuant to Section 5 of this
Agreement, this Agreement and the employment relationship hereunder shall
continue from the Effective Date until December 31, 2011. As used in this
Agreement, the “Term” shall refer to the period beginning on the Effective Date
and ending on the earlier of (i) December 31, 2011 or (ii) the date the
Executive’s employment terminates in accordance with Section 5 below. In the
event that the Executive’s employment with the Company terminates, the Company’s
obligation to continue to pay, after the date of termination, Base Salary (as
defined below), Bonus (as defined below) and other unaccrued benefits shall
terminate except as may be provided for in Section 5 below.
     3. Duties and Title.
          3.1 Title. The Company shall employ the Executive to render exclusive
and full-time services to the Company and its subsidiaries. The Executive shall
serve in the capacity of President, and shall report directly to the Board of
Directors of the Company (the “Board”) and the Chief Executive Officer of the
Company.
          3.2 Duties. The Executive will have such authority and
responsibilities and will perform such executive duties customarily performed by
a President of a company in similar lines of business as the Company and its
subsidiaries or as may be reasonably assigned to the Executive by the Board. The
Executive will devote substantially all of his full working-time and attention
(other than due to physical or mental incapacity) to the

 

--------------------------------------------------------------------------------

 

performance of such duties and to the promotion of the business and interests of
the Company and its subsidiaries. Provided that the following activities do not
materially interfere with the Executive’s duties and responsibilities as
President (as determined by the Company), the Executive may (i) with the prior
written consent of the Board (which shall not be unreasonably withheld), serve
on boards, committees and commissions of charitable organizations, (ii) manage
his personal investments, and (iii) with the prior written consent of the Board
(which shall not be unreasonably withheld), serve on the boards of directors of
other companies.
     4. Compensation and Benefits by the Company. As compensation for all
services rendered pursuant to this Agreement, the Company shall provide the
Executive the following during the Term:
          4.1 Base Salary. The Company will pay to the Executive an annualized
base salary of not less than $850,000, payable in accordance with the customary
payroll practices of the Company (“Base Salary”). The Base Salary shall be
reviewed no less frequently than annually for purposes of increase, such
increase, if any, to be determined in the sole discretion of the Board or the
compensation committee of the Board (the “Compensation Committee”).
          4.2 Retention Bonus. The Company will pay to the Executive a retention
bonus of $700,000 (the “Retention Bonus”), payable in four (4) equal quarterly
installments, the first of which to occur three (3) months following the
Effective Date, subject to the Executive’s continued employment with the Company
on the date of each installment, except as set forth in Section 5.2.
          4.3 Bonuses. The Executive shall be eligible to receive an annual
bonus (“Bonus”) under a plan established by the Company based upon achievement
of performance targets and key measures determined by the Board or the
Compensation Committee. The Executive’s target bonus shall be $1,150,000 (the
“Target Bonus”), with the actual amount of each Bonus being determined by the
Board or the Compensation Committee in accordance with the applicable plan and
formula.
          4.4 Long-Term Incentive Compensation.
               (a) Subject to the terms of the Company’s Long-Term Phantom
Interest Plan (the “Phantom Interest Plan”) and an award agreement, the
Executive shall be granted on, or as soon as practicable following, the
Effective Date an award with an Award Percentage (as defined in the Phantom
Interest Plan) equal to 0.075% payable, subject to the Executive’s continued
employment with the Company (except as set forth in Section 5.2 hereof), as soon
as practicable following the third anniversary of the date of grant (the
“Payment Date”). In addition, subject to his continued employment with the
Company (except as set forth in Section 5.2 hereof), on the third anniversary of
the date of grant, or as soon as practicable thereafter, the Executive shall be
granted an additional award with an Award Percentage equal to 0.075% payable,
subject to the Executive’s continued employment with the Company, as soon as
practicable following the third anniversary of the date of the grant of such
award.
               (b) Subject to the terms and conditions set forth on Exhibit A
attached hereto, the Amended and Restated Limited Liability Company Operating
Agreement of the Company, and the GMAC Management LLC Class C Membership
Interest Plan and award

2

--------------------------------------------------------------------------------

 

agreement, the Executive shall be granted on, or as soon as practicable
following, the Effective Date, directly or indirectly, 0.30% of the Class C
Membership Interests of the Company.
          4.5 Participation in Employee Benefit Plans. The Executive shall be
entitled, if and to the extent eligible, to participate in all of the applicable
benefit plans and perquisite programs of the Company, which may be available to
other senior executives of the Company, on the same terms as such other
executives. The Executive shall be entitled to the same perquisites the
Executive was entitled to receive immediately prior to the Effective Date;
provided that such perquisites may be modified or terminated to the same extent
modified or terminated for other senior executives of the Company. The Company
may at any time or from time to time amend, modify, suspend or terminate any
employee benefit plan, program or arrangement for any reason without the
Executive’s consent if such amendment, modification, suspension or termination
is consistent with the amendment, modification, suspension or termination for
other executives of the Company.
          4.6 Vacation. The Executive shall be entitled to five (5) weeks of
paid vacation. The Executive shall not be entitled to payment for unused
vacation days upon the termination of his employment except as set forth in
Section 5 below. The carry-over and accrual of vacation days shall be in
accordance with Company policy.
          4.7 Expense Reimbursement. The Executive shall be entitled to receive
reimbursement for all appropriate business expenses incurred by him in
connection with his duties under this Agreement in accordance with the policies
of the Company as in effect from time to time.
     5. Termination of Employment.
          5.1 By the Company for Cause or by the Executive Without Good Reason
or Due to Death or Disability. If: (i) the Executive’s employment terminates due
to his death; (ii) the Company terminates the Executive’s employment with the
Company for Cause (as defined below); (iii) the Company terminates the
Executive’s employment with the Company due to the Executive’s Disability (as
defined below); or (iv) the Executive terminates his employment without Good
Reason (as defined below) the Executive or the Executive’s legal representatives
(as appropriate), shall be entitled to receive the following:
               (a) the Executive’s accrued but unpaid Base Salary to the date of
termination and any employee benefits that the Executive is entitled to receive
pursuant to the employee benefit plans of the Company and its subsidiaries
(other than any severance plans) in accordance with the terms of such employee
benefit plans;
               (b) the unpaid portion of the Bonus, if any, relating to any
calendar year prior to the calendar year of the Executive’s death, termination
due to Disability, termination by the Company for Cause or by the Executive
without Good Reason, payable in accordance with Section 4.3 above;
               (c) payment for accrued unused vacation days, payable in
accordance with Company policy; and

3

--------------------------------------------------------------------------------

 

               (d) expenses reimbursable under Section 4.6 above incurred but
not yet reimbursed to the Executive to the date of termination.
          For the purposes of this Agreement, “Disability” means a determination
by a licensed physician in accordance with applicable law that as a result of a
physical or mental injury or illness, the Executive is unable to perform the
essential functions of his job with or without reasonable accommodation for a
period of (i) one hundred twenty (120) consecutive days or (ii) one hundred
eighty (180) days in any one (1) year period (the “Disability Date”). Either the
Executive or the Company may request that a licensed physician be selected. The
licensed physician shall be mutually and reasonably selected by the Company and
the Executive (or his legal representative); provided, that if a licensed
physician is not mutually selected within ten (10) business days following a
request for a licensed physician, the Company shall select a licensed physician
in good faith.
          For the purposes of this Agreement, “Cause” means, as determined by
the Board, (i) indictment of the Executive for a felony; (ii) conduct by the
Executive in connection with his employment duties or responsibilities that is
fraudulent or grossly negligent, (iii) willful misconduct on an ongoing basis
after written notice from the Company or any of its subsidiaries to the
Executive, (iv) the Executive’s contravention of specific written lawful
directions related to a material duty or responsibility which is directed to be
undertaken from the Board or the person to whom the Executive reports which is
not cured within 20 days of the Executive’s receipt of written notice of such
contravention; (v) breach of the Executive’s covenants set forth in Section 6
below; (vi) any acts of dishonesty by the Executive resulting or intending to
result in personal gain or enrichment at the expense of the Company, its
subsidiaries or affiliates; or (vii) the Executive’s continued failure to comply
with a material policy of the Company, its subsidiaries or affiliates after
receiving notice from the Board or the Chief Executive Officer of the Company of
such failure to comply. An act or failure to act shall not be “willful” if the
Executive reasonably believed that such action or inaction was in the best
interests of the Company. A termination for “Cause” shall be effective
immediately (or on such other date set forth by the Board).
          For the purposes of this Agreement, “Good Reason” means, without the
Executive’s consent, (i) a reduction in Base Salary or bonus; provided that, the
Company may at any time or from time to time amend, modify, suspend or terminate
any bonus, incentive compensation or other benefit plan or program provided to
the Executive for any reason and without the Executive’s consent if such
modification, suspension or termination (x) is a result of the underperformance
of the Company under its business plan, (y) is consistent with an “across the
board” reduction for all senior executives of the Company, and (z) is undertaken
in the Board’s reasonable business judgment acting in good faith and engaging in
fair dealing with the Executive, or (ii) a material diminution in the
Executive’s title, duties or responsibilities below a level consistent with
Executive’s performance and skill level, as determined in good faith by the
Board; provided that, a suspension of the Executive and the requirement that the
Executive not report to work shall not constitute Good Reason if the Executive
continues to receive his compensation and benefits. The Company shall have
thirty (30) days after receipt of notice from the Executive in writing
specifying the deficiency to cure the deficiency that would result in Good
Reason.
          5.2 By the Company Without Cause or by the Executive for Good Reason.
If during the Term, the Executive terminates his employment for Good Reason,
upon at

4

--------------------------------------------------------------------------------

 

least thirty (30) days prior written notice to the Company, or the Company
terminates the Executive’s employment without Cause, and upon execution without
revocation of a valid release agreement substantially in the form attached
hereto as Exhibit B (except that the Company shall, in its sole discretion, have
the right to amend the release agreement to take into account changes in law
effective subsequent to the Effective Date), the Executive shall receive the
following incremental severance payments set forth in this Section 5.2 (in
addition to the payments upon termination specified in Section 5.1):
               (a) continued payment of any unpaid installments of the Retention
Bonus, if any (the sum of the unpaid installments, the “Unpaid Retention
Bonus”);
               (b) an amount equal to the excess of (x) the product of (1) the
Severance Multiplier (as defined below) multiplied by (2) the Executive’s Base
Salary over (y) the Unpaid Retention Bonus, such amount payable in equal monthly
installments on the last business day of each month over a number of months
following such termination of employment equal to the Severance Multiplier;
               (c) (x) if such termination occurs on or prior to June 30th, an
amount equal to the product of (1) the Severance Multiplier multiplied by
(2) the Severance Bonus Amount (as defined below), payable in equal monthly
installments on the last business day of each month over a number of months
following such termination of employment equal to the Severance Multiplier or
(y) if such termination occurs following June 30th, an amount equal to (1) the
Severance Multiplier multiplied by (2) the Severance Bonus Amount, payable as
follows, (A) a lump sum equal to such amount multiplied by a fraction, the
numerator of which is the number of full months following such termination
through the date such amounts are paid to similarly situated employees (the
“Lapsed Months”) and the denominator of which is equal to the Severance
Multiplier (such fraction not to exceed one (1)) and (B) the remaining amount,
if any, payable in equal monthly installments for a number of months equal to
the Severance Multiplier minus the number of Lapsed Months;
               (d) a pro rata bonus for the year of termination, calculated as
the product of (x) “Severance Bonus Amount” and (y) a fraction, the numerator of
which is the number of days in the current calendar year through the date of
termination and the denominator of which is 365, payable in the calendar year
following the date of termination when bonuses are paid to similarly situated
employees;
               (e) a pro rata payment with respect to any award outstanding
under the Phantom Interest Plan equal to the amount that would have been payable
to the Executive for the performance period applicable to such award (determined
as of the end of such performance period) multiplied by a fraction, the
numerator of which is the number of full months in the performance period that
have lapsed prior to such termination and the denominator of which is the number
of months in the performance period, payable at the end of such performance
period; and
               (f) reimbursement of the employer portion of the cost (consistent
with the Company’s policy for active employees) of continuation coverage of
group health coverage pursuant to the Consolidated Omnibus Budget Reconciliation
Act of 1985, as amended (“COBRA”) for a number of months equal to the lesser of
(x) the Severance Multiple and (y) eighteen (18), to the extent the Executive
elects such continuation coverage and is

5

--------------------------------------------------------------------------------

 

eligible for such coverage and subject to the terms of the plan and the law.
Notwithstanding the foregoing, the benefits provided under this Section 5.2(f)
shall cease when the Executive is covered under another group health plan.
     For purposes of this Agreement, (x) the “Severance Multiplier” shall equal
the lesser of (A) two (2) and (B) the quotient of (1) the number of full months
remaining in the Term divided by (2) twelve (12); provided that in no event
shall the Severance Multiplier be less than         .5 and (y) the “Severance
Bonus Amount” shall mean, in the event of a termination (i) on or prior to
June 30th of any calendar year, the Bonus paid to the Executive for the calendar
year prior to the termination or (ii) after June 30th of any calendar year, the
Bonus that would have been payable to the Executive for the calendar year of the
termination (determined as of the end of such calendar year). Notwithstanding
the foregoing, the amount payable pursuant to the sum of (b) and (c) above shall
not be less than the excess of (x) the product of the Severance Multiplier
multiplied by $1 million over (y) the Unpaid Retention Bonus.
     The Company shall have no obligation to provide the benefits set forth
above in the event that the Executive materially breaches the provisions of
Section 6.
          5.3 Continued Employment Beyond the Expiration of the Term. Unless the
Parties otherwise agree in writing, continuation of the Executive’s employment
with the Company beyond the expiration of the Term shall be deemed an employment
at-will and shall not be deemed to extend any of the provisions of this
Agreement and the Executive’s employment may thereafter be terminated at will by
either the Executive or the Company; provided that the provisions of
Sections 5.6, 6, 7, 8, 9.6, 9.11 and 9.12 of this Agreement shall survive any
termination of this Agreement or the termination of the Executive’s employment
hereunder.
          5.4 No Mitigation; No Offset. The Executive shall be under no
obligation to seek other employment after his termination of employment with the
Company and the obligations of the Company to the Executive which arise upon the
termination of his employment pursuant to this Section 5 shall not be subject to
mitigation or offset.
          5.5 Removal from any Boards and Position. If the Executive’s
employment is terminated for any reason under this Agreement, he shall be deemed
to resign (i) if a member, from the Board or board of directors of any
subsidiary of the Company or any other board to which he has been appointed or
nominated by or on behalf of the Company and (ii) from any position with the
Company or any subsidiary of the Company, including, but not limited to, as an
officer of the Company and any of its subsidiaries.
          5.6 Nondisparagement. The Executive agrees that he will not at any
time (whether during or after the Term) publish or communicate to any person or
entity any Disparaging (as defined below) remarks, comments or statements
concerning the Company, its parent, subsidiaries and affiliates, and their
respective present and former members, partners, directors, officers,
shareholders, employees, agents, attorneys, successors and assigns. The Company
agrees to instruct its executive officers and directors to refrain from
publishing or communicating to any person or entity any Disparaging remarks,
comments or statements concerning the Executive at any time (whether during or
after the Term), provided that, nothing in this Section 5.6 shall prevent the
Company from (a) responding in a truthful manner to inquiries regarding
Executive’s employment or the termination thereof, from investors,

6

--------------------------------------------------------------------------------

 

regulators, the Company’s auditors or insurers, or as otherwise may be required
by applicable law, rules or regulations, or (b) disclosing information
concerning the Executive or the termination of Executive’s employment to
officers of the Company or its affiliates who, at the discretion of the Company,
should know such information. “Disparaging” remarks, comments or statements are
those that impugn the character, honesty, integrity or morality or business
acumen or abilities in connection with any aspect of the operation of business
of the individual or entity being disparaged.
     6. Restrictions and Obligations of the Executive.
          6.1 Confidentiality. (a) During the course of the Executive’s
employment by the Company (prior to and during the Term), the Executive has had
and will have access to certain trade secrets and confidential information
relating to the Company and its subsidiaries (the “Protected Parties”) which is
not readily available from sources outside the Company. The confidential and
proprietary information and, in any material respect, trade secrets of the
Protected Parties are among their most valuable assets, including but not
limited to, their customer, supplier and vendor lists, databases, competitive
strategies, computer programs, frameworks, or models, their marketing programs,
their sales, financial, marketing, training and technical information, their
product development (and proprietary product data) and any other information,
whether communicated orally, electronically, in writing or in other tangible
forms concerning how the Protected Parties create, develop, acquire or maintain
their products and marketing plans, target their potential customers and operate
their retail and other businesses. The Protected Parties invested, and continue
to invest, considerable amounts of time and money in their process, technology,
know-how, obtaining and developing the goodwill of their customers, their other
external relationships, their data systems and data bases, and all the
information described above (hereinafter collectively referred to as
“Confidential Information”), and any misappropriation or unauthorized disclosure
of Confidential Information in any form would irreparably harm the Protected
Parties. The Executive acknowledges that such Confidential Information
constitutes valuable, highly confidential, special and unique property of the
Protected Parties. The Executive shall hold in a fiduciary capacity for the
benefit of the Protected Parties all Confidential Information relating to the
Protected Parties and their businesses, which shall have been obtained by the
Executive during the Executive’s employment by the Company or its subsidiaries
and which shall not be or become public knowledge (other than by acts by the
Executive or representatives of the Executive in violation of this Agreement).
The Executive shall not, during the period the Executive is employed by the
Company or its subsidiaries or at any time thereafter, disclose any Confidential
Information, directly or indirectly, to any person or entity for any reason or
purpose whatsoever, nor shall the Executive use it in any way, except (i) in the
course of the Executive’s employment with, and for the benefit of, the Protected
Parties, (ii) to enforce any rights or defend any claims hereunder or under any
other agreement to which the Executive is a party, provided that such disclosure
is relevant to the enforcement of such rights or defense of such claims and is
only disclosed in the formal proceedings related thereto, (iii) when required to
do so by a court of law, by any governmental agency having supervisory authority
over the business of the Company or by any administrative or legislative body
(including a committee thereof) with jurisdiction to order him to divulge,
disclose or make accessible such information; provided that the Executive shall
give prompt written notice to the Company of such requirement, disclose no more
information than is so required, and cooperate with any attempts by the Company
to obtain a protective order or similar treatment, (iv) as to such Confidential
Information that becomes generally known to the public or

7

--------------------------------------------------------------------------------

 

trade without his violation of this Section 6.1(a) or (iv) to the Executive’s
spouse, attorney and/or his personal tax and financial advisors as reasonably
necessary or appropriate to advance the Executive’s tax, financial and other
personal planning (each an “Exempt Person”), provided, however, that any
disclosure or use of Confidential Information by an Exempt Person shall be
deemed to be a breach of this Section 6.1(a) by the Executive. The Executive
shall take all reasonable steps to safeguard the Confidential Information and to
protect it against disclosure, misuse, espionage, loss and theft. The Executive
understands and agrees that the Executive shall acquire no rights to any such
Confidential Information.
     (b) All files, records, documents, drawings, specifications, data, computer
programs, evaluation mechanisms and analytics and similar items relating thereto
or to the Business (for the purposes of this Agreement, “Business” shall be as
defined in Section 6.3 hereof), as well as all customer lists, specific customer
information, compilations of product research and marketing techniques of the
Company and its subsidiaries, whether prepared by the Executive or otherwise
coming into the Executive’s possession, shall remain the exclusive property of
the Company and its subsidiaries.
     (c) It is understood that while employed by the Company or its
subsidiaries, the Executive will promptly disclose to it, and assign to it the
Executive’s interest in any invention, improvement or discovery made or
conceived by the Executive, either alone or jointly with others, which arises
out of the Executive’s employment. At the Company’s request and expense, the
Executive will assist the Company and its subsidiaries during the period of the
Executive’s employment by the Company or its subsidiaries and thereafter (but
subject to reasonable notice and taking into account the Executive’s schedule)
in connection with any controversy or legal proceeding relating to such
invention, improvement or discovery and in obtaining domestic and foreign patent
or other protection covering the same.
     (d) As requested by the Company and at the Company’s expense, from time to
time and upon the termination of the Executive’s employment with the Company for
any reason, the Executive will promptly deliver to the Company and its
subsidiaries all copies and embodiments, in whatever form, of all Confidential
Information in the Executive’s possession or within his control (including, but
not limited to, memoranda, records, notes, plans, photographs, manuals,
notebooks, documentation, program listings, flow charts, magnetic media, disks,
diskettes, tapes and all other materials containing any Confidential
Information) irrespective of the location or form of such material. If requested
by the Company, the Executive will provide the Company with written confirmation
that all such materials have been delivered to the Company as provided herein.
          6.2 Non-Solicitation or Hire. During the Term and for a period of
twelve (12) months following the termination of the Executive’s employment for
any reason, the Executive shall not (a) directly or indirectly solicit or
attempt to solicit or induce, directly or indirectly, (x) any party who is a
customer of the Company or its subsidiaries, who was a customer of the Company
or its subsidiaries at any time during the twelve (12) month period immediately
prior to the date the Executive’s employment terminates or who is a prospective
customer that has been identified and targeted by the Company or its
subsidiaries, for the purpose of marketing, selling or providing to any such
party any services or products offered by or available from the Company or its
subsidiaries (provided that if the Executive intends to solicit any such party
for any other purpose, he shall notify the Company of such intention), or
(y) any supplier to the Company or any subsidiary to terminate, reduce or alter
negatively its

8

--------------------------------------------------------------------------------

 

relationship with the Company or any subsidiary or in any manner interfere with
any agreement or contract between the Company or any subsidiary and such
supplier or (b) directly or indirectly solicit or attempt to solicit any
employee of the Company or any of its subsidiaries (a “Current Employee”) or any
person who was an employee of the Company or any of its subsidiaries during the
twelve (12) month period immediately prior to the date the Executive’s
employment terminates (a “Former Employee”) to terminate such employee’s
employment relationship with the Protected Parties in order, in either case, to
enter into a similar relationship with the Executive, or any other person or any
entity or hire any employee or Former Employee, provided, however, that Current
Employees and Former Employees do not include the Executive’s personal
assistant(s) or his administrative support personnel.
          6.3 Non-Competition. During the Term and for a period of six
(6) months following the termination of the Executive’s employment for any
reason, the Executive shall not, whether individually, as a director, manager,
member, stockholder, partner, owner, employee, consultant or agent of any
business, or in any other capacity, other than on behalf of the Company or a
subsidiary, organize, establish, own, operate, manage, control, engage in,
participate in, invest in, permit his name to be used by, act as a consultant or
advisor to, render services for (alone or in association with any person, firm,
corporation or business organization), or otherwise assist any person or entity
that engages in or owns, invests in, operates, manages or controls any venture
or enterprise which engages or proposes to engage in any business conducted by
the Company or any of its subsidiaries on the date of the Executive’s
termination of employment or within twelve (12) months of the Executive’s
termination of employment in the geographic locations where the Company and its
subsidiaries engage or propose to engage in such business (the “Business”).
Notwithstanding the foregoing, nothing in this Agreement shall prevent the
Executive from (i) owning for passive investment purposes not intended to
circumvent this Agreement, less than five percent (5%) of the publicly traded
common equity securities of any company engaged in the Business (so long as the
Executive has no power to manage, operate, advise, consult with or control the
competing enterprise and no power, alone or in conjunction with other affiliated
parties, to select a director, manager, general partner, or similar governing
official of the competing enterprise other than in connection with the normal
and customary voting powers afforded the Executive in connection with any
permissible equity ownership), (ii) being employed by or otherwise associated
with an organization or entity of which a subsidiary, division, segment, unit,
etc. is engaged in the Business (a “Competing Division”), provided that (x) the
Executive has no direct or indirect responsibilities or involvement with such
Competing Division and (y) the Competing Division does not account for more that
five percent (5%) of the gross revenues of such organization or entity for its
prior fiscal year or (iii) being employed by or otherwise associated with an
organization or entity engaged in the Business; provided that the Business that
is competitive with the Company or any of its Subsidiaries does not account for
more than five percent (5%) of the gross revenues of the Company and its
Subsidiaries.
          6.4 Property. The Executive acknowledges that all originals and copies
of materials, records and documents generated by him or coming into his
possession during his employment by the Company or its subsidiaries are the sole
property of the Company and its subsidiaries (“Company Property”). During the
Term, and at all times thereafter, the Executive shall not remove, or cause to
be removed, from the premises of the Company or its subsidiaries, copies of any
record, file, memorandum, document, computer related information or equipment,
or any other item relating to the business of the Company or its subsidiaries,
except

9

--------------------------------------------------------------------------------

 

in furtherance of his duties under the Agreement. When the Executive’s
employment with the Company terminates, or upon request of the Company at any
time, the Executive shall promptly deliver to the Company all copies of Company
Property in his possession or control.
     7. Remedies; Specific Performance. The Parties acknowledge and agree that
the Executive’s breach or threatened breach of any of the restrictions set forth
in Section 6 will result in irreparable and continuing damage to the Protected
Parties for which there may be no adequate remedy at law and that the Protected
Parties shall be entitled to seek equitable relief, including specific
performance and injunctive relief as remedies for any such breach or threatened
or attempted breach, without requiring the posting of a bond. The Executive
hereby consents to the grant of an injunction (temporary or otherwise) against
the Executive or the entry of any other court order against the Executive
prohibiting and enjoining him from violating, or directing him to comply with
any provision of Section 6, if such is determined by a court of competent
jurisdiction. The Executive also agrees that such remedies shall be in addition
to any and all remedies, including damages, available to the Protected Parties
against him for such breaches or threatened or attempted breaches. In addition,
without limiting the Protected Parties’ remedies for any breach of any
restriction on the Executive set forth in Section 6, except as required by law,
the Executive shall not be entitled to any payments set forth in Section 5.2
hereof if the Executive has breached the covenants applicable to the Executive
contained in Section 6, the Executive will immediately return to the Protected
Parties any such payments previously received under Section 5.2 upon such a
breach, and, in the event of such breach, the Protected Parties will have no
obligation to pay any of the amounts that remain payable by the Company under
Section 5.2.
     8. Indemnification. The Company agrees, to the extent permitted by
applicable law and its organizational documents, to indemnify, defend and hold
harmless the Executive from and against any and all losses, suits, actions,
causes of action, judgments, damages, liabilities, penalties, fines, costs or
claims of any kind or nature (“Indemnified Claim”), including reasonable legal
fees and related costs incurred by Executive in connection with the preparation
for or defense of any Indemnified Claim, whether or not resulting in any
liability, to which the Executive may become subject or liable or which may be
incurred by or assessed against the Executive, relating to or arising out of his
employment by the Company or the services to be performed pursuant to this
Agreement, provided that the Company shall only defend, but not indemnify or
hold the Executive harmless, from and against an Indemnified Claim in the event
there is a final, non-appealable, determination that the Executive’s liability
with respect to such Indemnified Claim resulted from the Executive’s willful
misconduct or gross negligence. The Company’s obligations under this section
shall be in addition to any other right, remedy or indemnification that the
Executive may have or be entitled to at common law or otherwise. During the Term
and for a period of six (6) years after the termination of the Executive’s
employment, the Company agrees to continue and maintain a directors and
officers’ liability insurance policy covering the Executive to the extent the
Company provides such coverage for its managers, directors and/or other
executive officers.
     9. Other Provisions.
          9.1 Notices. Any notice or other communication required or which may
be given hereunder shall be in writing and shall be delivered personally,
telegraphed, telexed, sent by facsimile transmission or sent by certified,
registered or express mail, postage prepaid or overnight mail and shall be
deemed given when so delivered personally, telegraphed,

10

--------------------------------------------------------------------------------

 

telexed, or sent by facsimile transmission or, if mailed, four (4) days after
the date of mailing or one (1) day after overnight mail, as follows:
               (a) If the Company, to:

              GMAC LLC     200 Renaissance Center     Tower 200, 9th Floor    
Mail Drop 482-B09-B11     Detroit, MI 48265     Attention: General Counsel    
Telephone: (313) 665-6128     Fax: (313) 665-6189
 
            With copies to:
 
            Schulte Roth & Zabel LLP     919 Third Avenue     New York, NY 10022
 
  Attention: Ronald Richman  
 
  Telephone: (212) 756-2000  
 
  Fax: (212) 593-5955  
 
       
 
  and    
 
            Cerberus Capital Management, L.P.     299 Park Avenue
 
  New York, NY 10171
 
  Attention: Lenard Tessler  
 
  Telephone: (212) 891-2100  
 
  Fax: (212) 755-3009  

               (b) If the Executive, to the Executive’s home address reflected
in the Company’s records and with copies to:

              Michael A. Nemeroff, Esq.     Vedder, Price, Kaufman & Kammholz,
P.C.     222 North LaSalle Street     Chicago, IL 60601
 
  Telephone: (312) 609-7500  
 
  Fax: (312) 609-5005  
 
       
 
  and    
 
            Stewart Reifler, Esq.     Vedder, Price, Kaufman & Kammholz, P.C.  
  805 Third Avenue     New York, NY 10022

11

--------------------------------------------------------------------------------

 

         
 
  Telephone: (212) 407-7700  
 
  Fax: (212) 407-7799  

          9.2 Entire Agreement. This Agreement contains the entire agreement
between the Parties with respect to the subject matter hereof and supersedes all
prior agreements, written or oral, with respect thereto.
          9.3 Representations and Warranties. The Executive represents and
warrants that he is not a party to or subject to any restrictive covenants,
legal restrictions or other agreements in favor of any entity or person which
would in any way preclude, inhibit, impair or limit the Executive’s ability to
perform his obligations under this Agreement, including, but not limited to,
non-competition agreements, non-solicitation agreements or confidentiality
agreements. The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization.
          9.4 Waiver and Amendments. This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by the Parties or, in the
case of a waiver, by the party waiving compliance. No delay on the part of any
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any waiver on the part of any right, power or
privilege hereunder, nor any single or partial exercise of any right, power or
privilege hereunder, preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder.
          9.5 Governing Law, Dispute Resolution and Venue.
               (a) This Agreement shall be governed and construed in accordance
with the laws of the State of New York applicable to agreements made and not to
be performed entirely within such state, without regard to conflicts of laws
principles, unless superseded by federal law.
               (b) The parties agree irrevocably to submit to the exclusive
jurisdiction of the federal courts or, if no federal jurisdiction exists, the
state courts, located in the City of New York, Borough of Manhattan, for the
purposes of any suit, action or other proceeding brought by any party arising
out of any breach of any of the provisions of this Agreement and hereby waive,
and agree not to assert by way of motion, as a defense or otherwise, in any such
suit, action, or proceeding, any claim that it is not personally subject to the
jurisdiction of the above-named courts, that the suit, action or proceeding is
brought in an inconvenient forum, that the venue of the suit, action or
proceeding is improper, or that the provisions of this Agreement may not be
enforced in or by such courts. In addition, the parties agree to waive trial by
jury.
          9.6 Assignability by Holdings and the Executive. This Agreement, and
the rights and obligations hereunder, may not be assigned by Holdings or the
Executive without written consent signed by the other party; provided that the
Company may assign the Agreement to any successor that continues the business of
the Company.

12

--------------------------------------------------------------------------------

 

          9.7 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original but all of which shall constitute one and
the same instrument.
          9.8 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning of terms
contained herein.
          9.9 Severability. If any term, provision, covenant or restriction of
this Agreement, or any part thereof, is held by a court of competent
jurisdiction of any foreign, federal, state, county or local government or any
other governmental, regulatory or administrative agency or authority to be
invalid, void, unenforceable or against public policy for any reason, the
remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected or
impaired or invalidated. The Executive acknowledges that the restrictive
covenants contained in Section 6 are a condition of this Agreement and are
reasonable and valid in temporal scope and in all other respects.
          9.10 Judicial Modification. If any court determines that any of the
covenants in Section 6, or any part of any of them, is invalid or unenforceable,
the remainder of such covenants and parts thereof shall not thereby be affected
and shall be given full effect, without regard to the invalid portion. If any
court determines that any of such covenants, or any part thereof, is invalid or
unenforceable because of the geographic or temporal scope of such provision,
such court shall reduce such scope to the minimum extent necessary to make such
covenants valid and enforceable.
          9.11 Tax Withholding. The Company or other payor is authorized to
withhold from any benefit provided or payment due hereunder, the amount of
withholding taxes due any federal, state or local authority in respect of such
benefit or payment and to take such other action as may be necessary in the
opinion of the Board to satisfy all obligations for the payment of such
withholding taxes.
          9.12 Section 409A. Notwithstanding any other provision of this
Agreement, if at the time of the termination of the Executive’s employment the
Executive is a “specified employee” (as defined in Section 409A of the Internal
Revenue Code of 1986, as amended (“Section 409A”)) and any payments upon such
termination under Section 5 hereof will result in additional tax or interest to
the Executive under Section 409A, he will not be entitled to receive such
payments until the date which is six (6) months after the termination of the
Executive’s employment for any reason, other than as a result of the Executive’s
death or disability (as such term is defined in Section 409A). In addition, if
any provision of this Agreement would subject the Executive to any additional
tax or interest under Section 409A, then the Company shall reform such
provision; provided that the Company shall (x) maintain, to the maximum extent
practicable, the original intent of the applicable provision without subjecting
the Executive to such additional tax or interest and (y) not incur any
additional compensation expense as a result of such reformation.

13

--------------------------------------------------------------------------------

 

     IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound
hereby, have executed this Agreement as of the day and year first above
mentioned.

                  EXECUTIVE  
 
                          Name: William Muir    
 
                GMAC LLC    
 
           
 
  By:        
 
                Name:         Title:    

 

--------------------------------------------------------------------------------

 

Exhibit A
Equity Interest Term Sheet

      Term   Provision
Equity
  The Executive will be granted restricted stock in a corporation (the
“Management Corporation”) that holds a profits interest in GMAC, LLC (“GMAC”).
As of the Closing Date (as defined below), GMAC will issue profits interests in
the form of units to the Management Corporation representing an interest in the
operating profits and realized appreciation of GMAC above the value of GMAC as
of the Closing Date (derived based on the purchase price of the equity interest
purchased in connection with the acquisition) plus a 10% preferred annual return
to the Investors (as defined below) on their common equity beginning on the
Closing Date, compounded annually (the “Hurdle”).
 
   
 
  With respect to distributions to the Investors (including distributions of
preferred equity in lieu of cash following the Closing Date) on their common
equity, a portion of such distributions equal to the amount of federal, state
and local income taxes (net of all tax credits) that would be payable by a New
York City individual resident on all the taxable income allocated to all
Investors for all periods on account of the common equity, as determined by the
Board (as defined below) in good faith, shall be deemed a Tax Distribution and
shall not be applied to the Hurdle, and the amount of such distributions in
excess of the Tax Distribution, if any, shall be applied to the Hurdle.
 
   
 
  In connection with the grant of the restricted stock, the Executive will make
an 83(b) election. GMAC represents that the fair market value of the restricted
stock is $5,563.0569 per share. GMAC will provide the Executive with a gross-up
payment with respect to all income taxes (including Medicare, but not social
security) required to be paid by the Executive as a result of the 83(b)
election.
 
   
Vesting
  Fifty percent of the restricted shares shall vest based on the Executive’s
continued employment (the “Time-Based Shares”) and fifty percent of the
restricted shares shall vest based on the achievement of performance targets
(the “Performance-Based Shares”), as more fully described below.
 
   
 
  The Time-Based Shares shall vest with respect to 20% of the Time-Based Shares
on the first anniversary of the date of grant and with respect to an additional
20% on each of the next four anniversaries thereafter, subject to the
Executive’s continued employment with GMAC and its affiliates.
 
   
 
  The Performance-Based Shares shall vest with respect to twenty percent (20%)
of the Performance-Based Shares on December 31, 2007 and with respect to an
additional twenty percent (20%) on each of the next four anniversaries of such
date (December 31, 2007 and each such anniversary, a “Performance Vesting
Date”), subject to GMAC’s attainment of performance targets established by the
Board for the calendar year in which such Performance Vesting Date occurs (the
“Performance Targets”) and subject to the Executive remaining employed by GMAC
or its subsidiaries on each applicable Performance Vesting Date; provided,
however, that in the event GMAC does not attain the Performance Target for an
applicable calendar year (a “Missed Year”), but achieves the Performance Targets
with respect to a subsequent calendar year, the restricted shares that did not
vest with respect to the Missed Year shall vest as of the Performance Vesting
Date applicable to the subsequent calendar year in which the Performance Targets
are achieved. All Performance-Based Shares that have not vested as of the
December 31, 2011, shall terminate.
 
   
 
  Notwithstanding the foregoing, in the event of a Change in Control (as defined
below) or an IPO of an affiliate of GMAC in which, as of the date of either of
such event, the Hurdle has been achieved, the Time-Based Shares that have not
vested (the “Accelerated Shares”), to the extent not previously forfeited, shall
immediately vest; provided, however, that if the Executive is terminated (x) by
GMAC for Cause (other than due to death or disability) or (y) by the Executive
without Good Reason (other than due to death or disability), prior to the date
the Accelerated Shares would otherwise have vested had no IPO or Change in
Control occurred, the Executive shall forfeit the

 

--------------------------------------------------------------------------------

 

      Term   Provision
 
  Accelerated Shares without the payment of consideration.
 
   
Termination of Employment
  Upon a termination of employment, all unvested restricted shares (and the
underlying profits interests) will be forfeited; provided, however, that if the
Executive is terminated (x) by GMAC without Cause (other than due to death or
disability) or (y) by the Executive for Good Reason (other than due to death or
disability), the Time-Based Shares (and the underlying profits interests) that
would have vested on the next anniversary of the date of grant shall immediately
vest. In addition, if the Executive is terminated (x) by GMAC for Cause (other
than due to death or disability) or (y) by the Executive without Good Reason
(other than due to death or disability), in each case, prior to the third
anniversary of the Closing Date, all the shares (and the underlying profits
interests), whether vested or unvested, will be forfeited.
 
   
Call/Put Rights
  At any time within 120 days following the Executive’s termination of
employment with GMAC for any reason, GMAC shall have the right, but not the
obligation, to cause the Executive to sell, or the Management Corporation to
redeem, the shares. The purchase price for the shares shall equal the fair
market value of the shares, as determined in good faith by the Board and
pursuant to a consistent methodology (the “Purchase Price”). If GMAC does not
exercise its right to repurchase or cause the Management Corporation to redeem,
the Investors shall have the right, for a period of 30 calendar days after the
expiration of the applicable 120-day period set forth above, to repurchase the
shares, upon the terms and conditions set forth above.
 
   
 
  To the extent that (i) the Executive is terminated after the fifth anniversary
of the Closing Date, (ii) GMAC or the Investors exercise their right to call the
shares or cause the redemption of the shares, (iii) within 12 months following
such termination of employment, there is (x) an IPO of an affiliate of GMAC or
(y) a Change in Control and (iv) the imputed price per share in connection with
such IPO or the imputed purchase price per share in connection with such Change
in Control (either such price, the “IPO/CIC Price”) exceeds the Purchase Price,
then the Executive shall be entitled to an additional cash payment equal to the
product of (x) the excess of the IPO/CIC Price over the Purchase Price
multiplied by (y) the number of shares subject to the call right.
 
   
 
  If there has not been an IPO or Change in Control, an Executive (or his estate
or legal guardian) shall have the right to sell the shares to GMAC, and, if
offered, GMAC or the Investors shall buy such shares or cause the Management
Corporation to redeem such shares (i) upon the death of the Executive for a
period of one year following the Executive’s death, (ii) two years following a
termination of the Executive’s employment due to Disability for a period of one
year following the second anniversary of such termination or (iii) ten years
following the Closing Date for a period of 150 days following such ten year
anniversary. The purchase price per share shall be the fair market value of a
share as determined in good faith by the Board and pursuant to a consistent
methodology.
 
   
 
  Upon the purchase or sale of the shares, the underlying profits interests will
be forfeited.
 
   
Tax Distributions
  GMAC will make tax distributions to Management Corporation in an amount
necessary for Management Corporation to pay income tax on income allocated to it
by GMAC. This tax distribution will be treated as an advance against future
distributions payable to Management Corporation and will reduce the next
distributions to Management Corporation (other than tax distributions) on a
dollar for dollar basis.
 
   
IPO
  In the event of an IPO of an affiliate of GMAC (the “IPO Company”), the shares
held by the Executive will be equitably converted (based on the fair market
value of the shares), as determined by the Board, into shares of the IPO Company
registered in connection with such IPO and such shares shall vest in accordance
with their terms, including, if any, accelerated vesting upon such IPO.
 
   
Transfer
  No shares may be transferred by the Executive prior to the later to occur of
(x) five years following the Closing Date and (y) two years following the IPO of
the IPO Company; provided, however, that, if such IPO occurs prior to the third
anniversary of the Closing Date, following the second anniversary of the IPO,
the Executive may transfer his vested shares with respect to the same percentage
of equity transferred by the Investors.
 
   
 
  The shares and the underlying profits interest shall be subject to customary
tag-along and drag-along rights.

 

--------------------------------------------------------------------------------

 

      Term   Provision
Adjustment
  In the event of any change in the capitalization of GMAC or the Management
Corporation by reason of any, reorganization, recapitalization, merger,
consolidation, spin-off, combination or any transaction similar to the
foregoing, the Board shall make such substitution or adjustment, if any, as it
deems to be equitable, to (i) the number or kind of restricted shares or
underlying profits interests and/or (iii) any other affected terms of such
restricted shares or underlying profits interests.
 
   
Definitions
  “Board” shall mean the Board of Managers of GMAC.
 
   
 
  “Change in Control” shall mean (1) if any person (other than an Investor)
becomes the beneficial owner, directly or indirectly, of 50% or more of the
combined voting power of the then issued and outstanding securities of GMAC or
(2) the sale, transfer or other disposition of all or substantially all of the
business and assets of GMAC, whether by sale of assets, merger or otherwise
(determined on a consolidated basis) to another person other than a transaction
in which the survivor or transferee is a person controlling, controlled by, or
under common control with, directly or indirectly, the Investors.
 
   
 
  “Closing Date” shall mean the closing date of the transaction in which General
Motors sells a fifty-one percent (51%) interest in GMAC.
 
   
 
  “Investors” shall mean all members of GMAC as of the Closing Date.

 

--------------------------------------------------------------------------------

 

Exhibit B
GENERAL RELEASE
     I, ___, in consideration of and subject to the terms and conditions set
forth in the Employment Agreement dated as of November 30, 2006 (the “Employment
Agreement”) to which this General Release is attached, and other good and
valuable consideration, do hereby release and forever discharge GMAC LLC (the
“Company”) and its current and former officers, directors, partners, members,
shareholders, investors, employees, attorneys, agents, predecessors, successors,
affiliates, assigns and legal representatives (together, the “Company Released
Parties”), from any and all claims, charges, manner of actions and causes of
action, suits, debts, dues, accounts, bonds, covenants, contracts, agreements,
judgments, charges, claims, and demands whatsoever which I, my heirs, executors,
administrators and assigns have, or may hereafter have against the Company
Released Parties arising out of or by reason of any cause, matter or thing
whatsoever, whether known or unknown, from the beginning of the world to the
date hereof (“Claims”) in connection with or relating to, my employment or
termination of employment with the Company and its subsidiaries, the Employment
Agreement, all employment-related matters arising under any federal, state or
local statute, rule or regulation or principle of contract law or common law and
any claims of employment discrimination, unlawful harassment or retaliation
claims and claims arising under Title VII of the Civil Rights Act of 1964, 42
U.S.C. § 2000 et seq., the Employee Retirement Income Security Act of 1974, 29
U.S.C. § 1001 et seq., the Fair Labor Standards Act (to the extent allowed by
law), 29 U.S.C. § 201 et seq., Age Discrimination in Employment Act of 1967, 29
U.S.C. § 621, et seq., the Reconstruction Era Civil Rights Act, 42 U.S.C. § 1981
et seq., the Americans with Disabilities Act of 1993, 42 U.S.C. § 12900 et seq.,
the Family and Medical Leave Act of 1990 (to the extent allowed by law), 42
U.S.C. § 12101, et seq., the New York State Human Rights Law, N.Y. Exec. Law §
290 et seq., the New York State Labor Law, N.Y. Labor Law § 1 et seq., and the
New York City Human Rights Law, N.Y.C. Admin. Code § 8-107 et seq., provided,
that this General Release shall not constitute a release of any Claims that
arise from a breach of Sections 5, 8 and/or 9 of the Employment Agreement.
     I acknowledge that I have been advised to consult with legal counsel. I
acknowledge that I have been provided with the opportunity to review and
consider this General Release for twenty-one (21) days from the date it was
provided to me. If I elect to sign before the expiration of the twenty-one
(21) days, I acknowledge that I will have chosen, of my own free will without
any duress, to waive my right to the full twenty-one (21) day period. I
understand that I may revoke this General Release within seven (7) days after my
execution by sending a written notice of revocation to ___ at the Company at
___, received within the seven-day revocation period.
     I acknowledge that I have not relied on any representations or statements
not set forth in the Employment Agreement or in this General Release. Unless
otherwise publicly-filed by the Company, I will not disclose the contents or
substance of this General Release to any third parties, other than my attorneys,
accountants, or as required by law, and I will instruct each of the foregoing
not to disclose the same. I am signing this General Release knowingly,
voluntarily and with full understanding of its terms and effects.
     This General Release will be governed by and construed in accordance with
the laws of the State of [New York]. If any provision in this General Release is
held invalid or

 

--------------------------------------------------------------------------------

 

unenforceable for any reason, the remaining provisions shall be construed as if
the invalid or unenforceable provision had not been included.
     In witness hereof, I have executed this General Release this ___ day of
___, 200_.

         
 
 
 
[Executive]