Exhibit
10.2


 


AMENDED AND EXTENDED

EMPLOYMENT AGREEMENT


 


This Amended and Extended Employment Agreement dated
as of April 1, 2003 is hereby made by and between Cendant Corporation, a
Delaware corporation (“Cendant”) and Kevin M. Sheehan (the “Executive”).


 


WHEREAS, Cendant desires to continue to employ the
Executive as a full-time employee of Cendant and the Executive desires to
continue to serve Cendant in such capacity.


 


NOW THEREFORE, in consideration of the foregoing and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:


 


SECTION I


EMPLOYMENT


 


Cendant agrees to
employ the Executive and the Executive agrees to be employed by Cendant for the
Period of Employment as provided in Section III below and upon the terms and
conditions provided in this Agreement.


 


SECTION II


POSITION AND
RESPONSIBILITIES


 


During the Period
of Employment, the Executive will serve as a full-time employee of Cendant and
will report directly to, and serve at the discretion of, the Chief Executive
Officer of Cendant Corporation (the “CEO”). The Executive will, during the Period
of Employment, serve Cendant in the capacity of Chairman and Chief Executive
Officer of Cendant’s Vehicle Services Division.  The Executive will, during the Period of Employment, devote
substantially all of his time and attention during normal business hours to the
performance of services for Cendant, or as otherwise reasonably directed by the
CEO from time to time. The Executive’s primary office location for performing
services hereunder will be Cendant’s corporate headquarters in New York, New
York, except for normal and reasonable business travel in connection with his
duties hereunder.  Executive understands
that he may be required to perform his duties from the Company’s northern New
Jersey office several days per week.


 

















 


SECTION III


PERIOD OF EMPLOYMENT


 


The period of the Executive’s employment under this
Agreement will begin on June 1, 2003 and end on May 30, 2006, subject to
earlier termination as provided herein (the “Period of Employment”); provided,
however, that the Period of Employment will be automatically extended
for an additional one year on June 1, 2004, and on each anniversary of such
date thereafter, unless written notice of non-extension is provided by either
party to the other party at least 30 days prior to any such anniversary.


 


SECTION IV


COMPENSATION AND BENEFITS


 


A.            Compensation.


 


For services
rendered by the Executive pursuant to this Agreement during the Period of
Employment, Cendant will pay the Executive base salary for the Period of
Employment at an annual rate equal to seven hundred sixty two thousand and five
hundred dollars ($762,500.00) (the “Base Salary”).  The Executive will be eligible to receive annual increases in
Base Salary in accordance with Cendant’s customary procedures regarding the
salaries of senior officers with due consideration given to the published
Consumer Price Index applicable to the New York/New Jersey greater metropolitan
area.


 


B.            Annual Incentive
Awards.


 


The Executive will
be eligible for discretionary annual incentive compensation awards; provided,
that the Executive will be eligible to receive an annual bonus for each fiscal
year of Cendant during the Period of Employment based upon a target bonus equal
to 100% of Base Salary, subject to Cendant’s attainment of applicable annual
performance goals (“Annual Performance Goals”) established and certified by the
Compensation Committee of the Board (the “Committee”).  Subject to the discretion of the Committee,
such annual incentive compensation award in respect of any fiscal year during
the Period of Employment may be paid at above target in the event that either
Cendant and/or the Vehicles Services Division, as the case may be,  materially outperforms its Annual Performance
Goals in such fiscal year.  The parties
acknowledge that it is currently contemplated that such Annual Performance
Goals will be stated in terms of “earnings before interest, depreciation and
taxes” of the Vehicle Services Division, however such targets may relate to
such other financial and business criteria of Cendant or any of its
subsidiaries or business units as determined by the Committee in its sole
discretion (each such annual bonus, an


 


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“Incentive Compensation
Award”). Notwithstanding the foregoing, subject to the Executive’s continuing
employment with Cendant through the date of payment and subject to the
applicable 2003 Annual Performance Goals being attained at no less than 100% of
target, and subject to such other terms and conditions determined by the
Committee, the Executive’s Incentive Compensation Award in respect of fiscal
year 2003 will include an incremental payment equal to $73,000.


 


C.            Employee Benefits.


 


During the Period
of Employment, Cendant will provide the Executive with employee benefits
generally offered to all eligible full-time employees of Cendant, and with
perquisites generally offered to all eligible senior officers of Cendant,
subject to the terms of the applicable employee benefit plans or policies of
Cendant.


 


D.            Expenses.


 


During the Period
of Employment, Cendant will reimburse the Executive for reasonable business
expenses incurred and timely submitted in accordance with any applicable policy
of Cendant.


 


E.             Signing Bonus.


 


Cendant will pay
the Executive a signing bonus equal to $73,000 as soon as practicable following
the execution of this Agreement and the commencement of the Period of
Employment.


 


SECTION V


DISABILITY


 


If the Executive becomes Disabled, as defined below,
during the Period of Employment, the Period of Employment may be terminated at
the option of the Executive upon notice of resignation to Cendant, or at the
option of Cendant upon notice of termination to the Executive.  Cendant’s obligation to make payments to the
Executive under this Agreement will cease as of such date of termination,
except for earned but unpaid Base Salary and any earned but unpaid Incentive Compensation
Awards.  In addition, upon such event,
each option to purchase shares of Cendant common stock granted to the Executive
either (i) on or after April 1, 2003 or (ii) on March 1, 2001, shall become
fully vested and exercisable and shall remain exercisable until the first to
occur of the third anniversary of such termination of employment or the
original expiration date of such option. 
For purposes of this Agreement, “Disabled” means the Executive’s
inability to perform his duties hereunder as a result of serious physical or
mental illness or injury for a period of no less than 90


 


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days, together with a
determination by an independent medical authority that (i) the Executive is
currently unable to perform such duties and (ii) in all reasonable likelihood
such disability will continue for a period in excess of an additional 90
days.  Such medical authority shall be
mutually and reasonably agreed upon by Cendant and the Executive and such
opinion shall be binding on Cendant and the Executive.


 


SECTION VI


DEATH


 


In the event of the death of the Executive during the
Period of Employment, the Period of Employment will end and Cendant’s
obligation to make payments under this Agreement will cease as of the date of
death, except for earned but unpaid Base Salary and any earned but unpaid
Incentive Compensation Awards, and except for a pro rata Incentive Compensation
Award for the year in which the death occurs, which will be paid to the
Executive’s surviving spouse, estate or personal representative, as
applicable.  In addition, upon such
event, each option to purchase shares of Cendant common stock granted to the
Executive either (i) on or after April 1, 2003 or (ii) on March 1, 2001, shall
become fully vested and exercisable and shall remain exercisable until the
first to occur of the third anniversary of such termination of employment or
the original expiration date of such option.


 


SECTION VII


EFFECT OF TERMINATION OF
EMPLOYMENT


 


A.            Without
Cause Termination and Constructive Discharge. If the Executive’s employment
is terminated during the Period of Employment by Cendant due to a Without Cause
Termination or by the Executive due to a Constructive Discharge (each as
defined below), Cendant will pay the Executive (or his surviving spouse, estate
or personal representative, as applicable) upon such Without Cause Termination
or Constructive Discharge (i) a lump sum amount equal to the Executive’s then
current Base Salary plus then targeted Incentive Compensation Award, multiplied
by 300% and (ii) any and all Base Salary earned but unpaid through the date of
such termination.  In addition, upon
such event (y) each option to purchase shares of Cendant common stock granted
to the Executive either on or after April 1, 2003, or on March 1, 2001, shall
become fully vested and exercisable and shall remain exercisable until the
first to occur of the third anniversary of such termination of employment or
the original expiration date of such option and (z) each option to purchase
shares of Cendant common stock granted to the Executive after March 1, 2001
(specifically excluding the option granted on March 1, 2001) and prior to April
1, 2003 shall become fully vested and exercisable and shall remain exercisable
until the first to occur of the second anniversary of such termination of
employment or the


 


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original expiration date
of such option.  Except as provided in
this paragraph, Cendant will have no further obligations to the Executive
hereunder.


 


B.            Termination
for Cause; Resignation.  If the
Executive’s employment terminates due to a Termination for Cause or a
Resignation, Base Salary and any Incentive Compensation Awards earned but
unpaid as of the date of such termination will be paid to the Executive in a
lump sum.  Except as provided in this
paragraph, Cendant will have no further obligations to the Executive hereunder.


 


C.            For
purposes of this Agreement, the following terms have the following meanings:


 


i.              “Termination for Cause” means (i)
the Executive’s willful failure to substantially perform his duties as an
employee of Cendant or any of its subsidiaries (other than any such failure
resulting from incapacity due to physical or mental illness), (ii) any act of
fraud, misappropriation, dishonesty, embezzlement or similar conduct against
Cendant or any of its subsidiaries, (iii) the Executive’s conviction of a
felony or any crime involving moral turpitude (which conviction, due to the passage
of time or otherwise, is not subject to further appeal) or (iv) the Executive’s
gross negligence in the performance of his duties hereunder.


 


ii.             “Constructive Discharge” means any
material failure of Cendant to fulfill its obligations under this Agreement (including
without limitation any reduction of the Base Salary, as the same may be
increased during the Period of Employment, or other material element of
compensation). The Executive will provide Cendant a written notice which
describes the circumstances being relied on for such termination with respect
to this Agreement within thirty (30) days after the event giving rise to the
notice.  Cendant will have thirty (30)
days after receipt of such notice to remedy the situation prior to the
termination for Constructive Discharge.


 


iii.            “Without Cause Termination” or
“Terminated Without Cause” means termination of the Executive’s employment by
Cendant other than due to death, Disability, or Termination for Cause.


 


iv.            “Resignation” means a termination of
the Executive’s employment by the Executive, other than in connection with a
Constructive Discharge.


 


D.            Conditions
to Payment and Acceleration.  All
payments and benefits due to the Executive under this Section VII shall be made
as soon as practicable; provided, however, that such payments and
benefits shall be subject to, and contingent upon, the execution by the
Executive (or his beneficiary or estate) of a release of claims against Cendant
and its affiliates in such form determined by Cendant


 


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in its sole
discretion.  The payments due to the
Executive under this Section VII shall be in lieu of any other severance
benefits otherwise payable to the Executive under any severance plan of Cendant
or its affiliates.


 


SECTION VIII


OTHER DUTIES OF THE
EXECUTIVE


DURING AND AFTER THE PERIOD
OF EMPLOYMENT


 


A.            The
Executive will, with reasonable notice during or after the Period of
Employment, furnish information as may be in his possession and fully cooperate
with Cendant and its affiliates as may be reasonably requested in connection with
any claims or legal action in which Cendant or any of its affiliates is or may
become a party, and Cendant shall reimburse the Executive for any expenses incurred
by the Executive in connection therewith.


 


B.            The
Executive recognizes and acknowledges that all information pertaining to this
Agreement or to the affairs; business; results of operations; accounting
methods, practices and procedures; members; acquisition candidates; financial
condition; clients; customers or other relationships of Cendant or any of its
affiliates (“Information”) is confidential and is a unique and valuable asset
of Cendant or any of its affiliates. 
Access to and knowledge of certain of the Information is essential to
the performance of the Executive’s duties under this Agreement.  The Executive will not during the Period of
Employment or thereafter, except to the extent reasonably necessary in
performance of his duties under this Agreement, give to any person, firm,
association, corporation, or governmental agency any Information, except as may
be required by law.  The Executive will
not make use of the Information for his own purposes or for the benefit of any
person or organization other than Cendant or any of its affiliates.  The Executive will also use his best efforts
to prevent the disclosure of this Information by others.  All records, memoranda, etc. relating to the
business of Cendant or its affiliates, whether made by the Executive or
otherwise coming into his possession, are confidential and will remain the
property of Cendant or its affiliates.


 


C.            i.              During the Period of Employment
and for a two (2) year period thereafter (the “Restricted Period”),
irrespective of the cause, manner or time of any termination, the Executive
will not use his status with Cendant or any of its affiliates to obtain loans,
goods or services from another organization on terms that would not be
available to him in the absence of his relationship to Cendant or any of its
affiliates.


 


ii.             During the Restricted Period, the
Executive will not make any statements or perform any acts intended to or which
may have the effect of advancing the


 


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interest of any existing
or prospective competitors of Cendant or any of its affiliates or in any way
injuring the interests of Cendant or any of its affiliates.  During the Restricted Period, the Executive,
without prior express written approval by the Board, will not engage in, or
directly or indirectly (whether for compensation or otherwise) own or hold
proprietary interest in, manage, operate, or control, or join or participate in
the ownership, management, operation or control of, or furnish any capital to
or be connected in any manner with, any party which competes in any way or
manner with the business of Cendant or any of its affiliates, as such business
or businesses may be conducted from time to time, either as a general or
limited partner, proprietor, common or preferred shareholder, officer,
director, agent, employee, consultant, trustee, affiliate, or otherwise.  The Executive acknowledges that Cendant’s
and its affiliates’ businesses are conducted nationally and internationally and
agrees that the provisions in the foregoing sentence will operate throughout
the United States and the world.


 


iii.            During the Restricted Period, the
Executive, without express prior written approval from the Board, will not
solicit any members or the then-current clients of Cendant or any of its
affiliates for any existing business of Cendant or any of its affiliates or discuss
with any employee of Cendant or any of its affiliates information or operation
of any business intended to compete with Cendant or any of its affiliates.


 


iv.            During the Restricted Period, the
Executive will not interfere with the employees or affairs of Cendant or any of
its affiliates or solicit or induce any person who is an employee of Cendant or
any of its affiliates to terminate any relationship such person may have with
Cendant or any of its affiliates, nor will the Executive during such period directly
or indirectly engage, employ or compensate, or cause or permit any person with
which the Executive may be affiliated, to engage, employ or compensate, any employee
of Cendant or any of its affiliates. 
The Executive hereby represents and warrants that the Executive has not
entered into any agreement, understanding or arrangement with any employee of
Cendant or any of its affiliates pertaining to any business in which the
Executive has participated or plans to participate, or to the employment, engagement
or compensation of any such employee.


 


v.             For the purposes of this Agreement,
proprietary interest means legal or equitable ownership, whether through stock
holding or otherwise, of an equity interest in a business, firm or entity or
ownership of more than 5% of any class of equity interest in a publicly-held
company and the term “affiliate” means all subsidiaries and licensees of the
applicable entity.


 


D.            The
Executive hereby acknowledges that damages at law may be an insufficient remedy
to Cendant if the Executive violates the terms of this Agreement and that
Cendant will be entitled, upon making the requisite showing, to


 


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preliminary and/or
permanent injunctive relief in any court of competent jurisdiction to restrain
the breach of or otherwise to specifically enforce any of the covenants
contained in this Section VIII without the necessity of showing any actual
damage or that monetary damages would not provide an adequate remedy.  Such right to an injunction will be in
addition to, and not in limitation of, any other rights or remedies Cendant may
have.  Without limiting the generality
of the foregoing, neither party will oppose any motion the other party may make
for any expedited discovery or hearing in connection with any alleged breach of
this Section VIII.


 


E.             The
period of time during which the provisions of this Section VIII will be in
effect will be extended by the length of time during which the Executive is in
breach of the terms hereof as determined by any court of competent jurisdiction
on Cendant’s application for injunctive relief.


 


F.             The
Executive agrees that the restrictions contained in this Section VIII are an
essential element of the compensation the Executive is granted hereunder and
but for the Executive’s agreement to comply with such restrictions, Cendant
would not have entered into this Agreement.


 


SECTION IX


WITHHOLDING TAXES


 


The Executive acknowledges and agrees that Cendant may
directly or indirectly withhold from any payments under this Agreement all
federal, state, city or other taxes that will be required pursuant to any law
or governmental regulation.


 


SECTION X


EFFECT OF PRIOR
AGREEMENTS


 


This Agreement will supersede and replace each prior
employment or consultant agreement between Cendant (and/or its affiliates),
including without limitation the Employment Agreement dated March 1, 2001
between Cendant and the Executive (other than any representations of the
parties set forth therein), and any such agreement shall be deemed superseded,
terminated and of no further force or effect.


 


SECTION XI


CONSOLIDATION, MERGER OR
SALE OF ASSETS


 


Nothing in this Agreement will preclude Cendant from
consolidating or merging into or with, or transferring all or substantially all
of its assets to, another corporation which assumes this Agreement and all
obligations and undertakings of


 


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Cendant hereunder.  Upon such a consolidation, merger or sale of
assets the term “Cendant” will mean the other corporation and this Agreement
will continue in full force and effect.


 


SECTION XII


MODIFICATION


 


This Agreement may not be modified or amended except
in writing signed by the parties.  No
term or condition of this Agreement will be deemed to have been waived except
in writing by the party charged with waiver. 
A waiver will operate only as to the specific term or condition waived
and will not constitute a waiver for the future or act on anything other than
that which is specifically waived.


 


SECTION XIII


REPRESENTATIONS


 


Cendant represents and warrants that this Agreement
has been authorized by all necessary corporate action of Cendant and is a valid
and binding agreement of Cendant enforceable against it in accordance with its
terms.


 


SECTION XIV


INDEMNIFICATION AND
MITIGATION


 


Cendant will indemnify the Executive to the fullest
extent permitted under the Certificate of Incorporation and By-Laws of Cendant.
The Executive will not be required to mitigate the amount of any payment
provided for hereunder by seeking other employment or otherwise, nor will the
amount of any such payment be reduced by any compensation earned by the
Executive as the result of employment by another employer after the date the
Executive’s employment hereunder terminates.


 


SECTION XV


GOVERNING LAW


 


This Agreement has been executed and delivered in the
State of New York and its validity, interpretation, performance and enforcement
will be governed by the internal laws of that state.


 


SECTION XVI


ARBITRATION


 


A.            Any
controversy, dispute or claim arising out of or relating to this Agreement or
the breach hereof which cannot be settled by mutual agreement (other than with
respect to the matters covered by Section VIII for which Cendant


 


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may, but will not be
required to, seek injunctive relief) will be finally settled by binding
arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state arbitration law) as follows:  Any party who is aggrieved will deliver a
notice to the other party setting forth the specific points in dispute.  Any points remaining in dispute twenty (20)
days after the giving of such notice may be submitted to arbitration in New
York, New York, to the American Arbitration Association, before a single
arbitrator appointed in accordance with the arbitration rules of the American
Arbitration Association, modified only as herein expressly provided.  After the aforesaid twenty (20) days, either
party, upon ten (10) days notice to the other, may so submit the points in
dispute to arbitration.  The arbitrator
may enter a default decision against any party who fails to participate in the
arbitration proceedings.


 


B.            The
decision of the arbitrator on the points in dispute will be final, unappealable
and binding, and judgment on the award may be entered in any court having
jurisdiction thereof.


 


C.            Except
as otherwise provided in this Agreement, the arbitrator will be authorized to
apportion its fees and expenses and the reasonable attorneys’ fees and expenses
of any such party as the arbitrator deems appropriate.  In the absence of any such apportionment,
the fees and expenses of the arbitrator will be borne equally by each party,
and each party will bear the fees and expenses of its own attorney.


 


D.            The
parties agree that this Section XVI has been included to rapidly and
inexpensively resolve any disputes between them with respect to this Agreement,
and that this Section XVI will be grounds for dismissal of any court action
commenced by either party with respect to this Agreement, other than
post-arbitration actions seeking to enforce an arbitration award.  In the event that any court determines that
this arbitration procedure is not binding, or otherwise allows any litigation
regarding a dispute, claim, or controversy covered by this Agreement to
proceed, the parties hereto hereby waive any and all right to a trial by jury
in or with respect to such litigation.


 


E.             The
parties will keep confidential, and will not disclose to any person, except as
may be required by law, the existence of any controversy hereunder, the
referral of any such controversy to arbitration or the status or resolution
thereof.


 


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SECTION XVII


SURVIVAL


 


Sections VII, VIII, IX, X, XIV, XV and XVI will
continue in full force in accordance with their respective terms
notwithstanding any termination of the Period of Employment.


 


SECTION XVIII


SEPARABILITY


 


All provisions of this Agreement are intended to be
severable.  In the event any provision
or restriction contained herein is held to be invalid or unenforceable in any
respect, in whole or in part, such finding will in no way affect the validity
or enforceability of any other provision of this Agreement.  The parties hereto further agree that any
such invalid or unenforceable provision will be deemed modified so that it will
be enforced to the greatest extent permissible under law, and to the extent
that any court of competent jurisdiction determines any restriction herein to
be unreasonable in any respect, such court may limit this Agreement to render
it reasonable in the light of the circumstances in which it was entered into
and specifically enforce this Agreement as limited.


 


IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first above written.


 


 


	
   

  	
  CENDANT CORPORATION

  
	
   

  	
   

  
	
   

  	
  /s/ Terence P. Conley

  
	
   

  	
  By:

  	
  Terence P. Conley

  
	
   

  	
  Title:

  	
  Executive Vice President,

  
	
   

  	
   

  	
  Human Resources

  
	
   

  	
   

  
	
   

  	
  KEVIN M. SHEEHAN

  
	
   

  	
   

  
	
   

  	
  /s/ Kevin M. Sheehan

  



 


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