EX-10.4



 




Exhibit 10.4


Dear Cendant Worldwide Associates with LTIP Awards:


Our recent announcement that Cendant will soon transform into 4 separate publicly traded companies
(the “Transaction”) is huge news for our shareholders and the financial markets, but we are also
aware that this is significant news for all of our worldwide employees. Mr. Silverman, the Senior
Management Team, and the Cendant Board of Directors realize that significant changes and extra
effort lie directly ahead for our key management employees.


The first step in our communication and retention plan is to provide you with information regarding
our planned treatment of your outstanding Long Term Incentive Plan (“LTIP”) awards in connection
with the Transaction. By providing you with special vesting for your 2003, 2004 and 2005 annual
LTIP awards (including special interim grants for new hires and welcome grants for acquired
business units), Senior Management and the Board of Directors expect that you will remain focused
on your daily operational duties, provide extra effort toward restructuring and preparing Cendant
for the Transaction, and maintain a positive and encouraging posture for the benefit of your direct
report employees, all of this notwithstanding your questions and uncertainties regarding the
future.


Cendant’s Compensation Committee has approved special vesting rights for all participants as
follows:


(1) Upon completion of the Transaction, 50% of all unvested
outstanding LTIP awards which had not previously vested will become
vested; and


(2) the remaining 50% of unvested outstanding LTIP awards will become
vested at the earlier of six months following completion of the
Transaction and December 31, 2006.


For these purposes, performance-based awards (including dividend equivalent units relating to
restricted stock units) will vest at 100% attainment of Total Unit Growth targets (the Compensation
Committee has determined that completion of the Transaction will not constitute a “Change of
Control” within the meaning of the LTIP plan documents, and thus awards relating to “above-target”
attainment of Total Unit Growth will not vest and will be cancelled upon completion of the
Transaction).


Depending on how the Transaction is ultimately structured, awards may vest (and the “above target”
portion may be cancelled) at earlier times, but so long as the Transaction is completed by December
31, 2006, awards will not vest any later than as described above. Also, awards scheduled to vest at
earlier times in accordance with regular vesting schedules will vest in accordance with those
regular vesting schedules. If for any reason the Transaction is not completed by December 31, 2006,
the existing terms of your award will continue to apply.


Generally, you will receive the special vesting described above only if you remain employed with
Cendant (or one of the newly created entities) through each of the respective vesting dates.
However, you will receive the special vesting if, during the pendency of the Transaction (or


 









 






following its completion), your employment terminates because of your death or Disability (as
defined in the applicable LTIP plan documents) or your employment is terminated by Cendant (or one
of the newly created entities) because of the elimination of your position in connection with the
Transaction. You will not receive the special vesting if, prior to the applicable vesting
date, you resign from your employment or you are terminated for below-expectation job performance
or a violation of the Cendant Code of Conduct.


Finally, to receive the special vesting, you must execute the acknowledgement and consent below
(which will evidence your consent to the terms and conditions set forth in this letter, including
the cancellation of all of your LTIP awards relating to the “above-target” attainment of Total Unit Growth as described
above). Please return a signed copy of the acknowledgement and consent to:


Cendant Corporation

One Campus Drive

Parsippany, New Jersey USA


At this crucial and exciting time in Cendant’s history, Senior Management thanks each of you for
your continued attention towards building and creating stockholder value and entrusts that you will
view next 12 to 18 months as a unique and special opportunity to be part of a team of “Company
Founders.” This is not the end of Cendant, but an exciting new beginning.


	 	 	 	 	 
	 	Very truly yours,
 
	 
	 	 	 
	 	Terry Conley,	 
	 	Executive Vice President, Human Resources

and Corporate Services
	 
	 




ACKNOWLEDGEMENT AND CONSENT


I hereby acknowledge and consent to the treatment of my outstanding LTIP awards as set forth above.


 



	 	 	 
	 
	Signature:







Name:

Date: