Document:

Exhibit 10.9

 

Equinox Holdings,
Inc.

895 Broadway

New York, New York
10003

 

 

April
5, 2005

 

Mr. Christopher Peluso

150 Columbus Avenue

Apartment 7F

New York, New York 10023

 

Separation Agreement

 

Dear Chris:

 

This
letter agreement (the “Agreement”)
sets forth the terms and conditions of our agreement regarding your termination
of employment with Equinox Holdings, Inc. (the “Company”) on January 7, 2005 (the “Termination Date”).

 

1.          Termination
of Employment.  Effective as of the
Termination Date, you hereby resign from employment with, and as an officer of,
the Company and each of its subsidiaries and affiliates.

 

2.          Payments
and Benefits.  As consideration for
entering into this Agreement and subject to paragraph 11(b) hereof, the Company
shall pay you $125,000 in lump sum within five (5) business days after the
expiration of the revocation period specified in paragraph 11(f) hereof.  In addition, on or about the Payment Date,
the Company will deliver to you one (1) letter in the form attached hereto as
Annex A on Company letterhead.

 

3.          Option
Cancellation.  As of April 7, 2005,
you acknowledge and agree that all of your vested options (the “Vested Options”) to purchase shares of the
Company’s common stock that were granted to you under the Equinox Holdings,
Inc. 2000 Stock Incentive Plan (the “Plan”),
and evidenced by your option agreements, dated as of December 2, 2002 and
September 3, 2003, with the Company (collectively, the “Option Agreements”), shall be
automatically canceled and terminated, and your rights in respect of such
options (whether under the Plan, the Option Agreements, or otherwise) shall
automatically be forfeited without any liability or obligation on the part of
the Company in respect thereof.  As of
the Termination Date, you acknowledge and agree that all of your unvested
options (the “Unvested Options”
and, together with the Vested Options, the “Options”)
to purchase shares of the Company’s common stock that were granted to you under
the Plan and evidenced by the Option Agreements, shall be automatically

 

 

canceled and terminated,
and your rights in respect of such options (whether under the Plan, the Option
Agreements, or otherwise) shall automatically be forfeited without any
liability or obligation on the part of the Company in respect thereof.

 

4.          Termination
of Agreements.  Effective as of the
Termination Date, the Company and you hereby agree that (i) your Letter Agreement, dated November
25, 2002, with the Company (as amended, modified or supplemented, the “Employment Agreement”), and (ii) your Non-Disclosure and
Non-Competition Agreement, dated November 25, 2002, with the Company (the “Non-Disclosure Agreement”) are terminated
in all respects, and that you and the Company are fully, completely,
irrevocably and forever discharged from any and all obligations set forth
therein, pursuant thereto or arising therefrom. 
Notwithstanding clause (ii) of this paragraph 4, (a) at all times hereafter, Sections 2,
3(a), 3(b) and 3(d) of the Non-Disclosure Agreement are incorporated by
reference herein and made a part hereof, and as so incorporated, shall remain
in full force and effect in accordance with their respective terms, and (b) you shall receive severance pay of the
equivalent of six months’ base salary, which shall be payable to you in substantially
equal bi-weekly installments beginning on the Termination Date.  You acknowledge and agree that you have
received $57,692.40 of such severance pay on or before the date hereof, and
that you are still owed $92,307.60 of such severance pay as of the date hereof.

 

5.          General
Release of Claims by You.

 

(a)        Release
of Claims.  Except for the payments
and benefits provided in Section 2 and 4 hereof, any accrued vested benefits
available to you under the express terms and conditions of any employee benefit
plan maintained by the Company, and your right to continue medical coverage at
your own expense after the Termination Date pursuant to section 4980B of the
Internal Revenue Code of 1986, as amended, you, on behalf of yourself and your
family, agents, representatives, attorneys, heirs, executors, trustees,
administrators, successors and assigns (the “Releasors”),
hereby irrevocably and unconditionally releases, settles, cancels, acquits,
discharges and acknowledges to be fully satisfied, and covenants not to sue the
Company and NCP-EH, L.P. and each of their respective subsidiaries, affiliates,
successors and assigns, and each of their respective stockholders, partners,
members, directors, managers, officers, employees, agents or other
representatives, and employee benefit plans of the Company (include current and
former trustees and administrators of these plans) (collectively, the “Releasees”) from any and all claims,
contractual or otherwise, demands, costs, rights, causes of action, charges,
debts, liens, promises, obligations, complaints, losses, damages and all
liability of whatever kind and nature, whether known or unknown, and hereby
waives any and all rights that he, she or it may have at the time of signing
this Agreement, at any time prior thereto or in the future (except with respect
to ADEA (as defined below) claims), or that otherwise may exist or may arise
(except with respect to ADEA claims) in respect of your employment or
separation from employment with the

 

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Company (including, but
not limited to, any right to receive bonus or incentive compensation), or is in
any way connected with or related to the Employment Agreement, the Options, the
Plan, or the Option Agreements.

 

(b)        Covenant
Not to Sue; Certain Proceedings.  The
Releasors agree not to bring any action, suit or proceeding whatsoever
(including the initiation of governmental proceedings or investigations of any
type) against any of the Releasees hereto for any matter or circumstance
concerning which the Releasors have released the Releasees under this
Agreement.  Further, the Releasors agree
not to encourage any other person or suggest to any other person that he, she
or it institute any legal action against the Releasees.  Notwithstanding the foregoing, this release
is not intended to interfere with your right to file a charge with the Equal
Employment Opportunity Commission in connection with any claim you believe you
may have against the Company.  The
Releasors hereby agree to waive the right to any relief (monetary or otherwise)
in any action, suit or proceeding you may bring in violation of this Agreement,
including any proceeding before the Equal Employment Opportunity Commission or
any other similar body or in any proceeding brought by the Equal Employment
Opportunity Commission or any other similar body on your behalf.

 

(c)        Extent
of Release.  This release is valid
whether any claim arises under any federal, state or local statute (including,
without limitation, Title VII of the Civil Rights Act of 1964, the Civil Rights
Act of 1991, the Age Discrimination in Employment Act of 1967 (“ADEA”), the Equal Pay Act, the Americans
with Disabilities Act of 1990, the Employee Retirement Income Security Act of
1974 and all other statutes regulating the terms and conditions of your
employment), regulation or ordinance, under the common law or in equity
(including any claims for wrongful discharge or otherwise), or under any
policy, agreement, understanding or promise, written or oral, formal or
informal, between the Company and its affiliates, on the one hand, and
yourself, on the other hand.

 

(d)        Penalties.  If you initiate or participate in any legal
actions or if you fail to abide by any of the terms of this Agreement, the
Company may reclaim any amounts paid hereunder, without waiving the release
granted herein, and terminate any remaining payments or benefits that are due
hereunder, in addition to any other remedies.

 

6.          General
Release of Claims by the Company.

 

(a)        The
Releasees hereby irrevocably and unconditionally release, settle, cancel,
acquit, discharge and acknowledge to be fully satisfied, and covenants not to
sue the Releasors from any and all claims, contractual or otherwise, demands,
costs, rights, causes of action, charges, debts, liens, promises, obligations,
complaints, losses, damages and all liability of whatever kind and nature,
whether known or unknown, and hereby waives any and all rights that he, she or
it may have at the time of signing this Agreement, at any time prior thereto or
in the future, or that otherwise may exist or may

 

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arise in respect of your
employment or separation from employment with the Company (including, but not
limited to, any right to receive bonus or incentive compensation), or is in any
way connected with or related to the Employment Agreement, the Options, any
Plan, or any Option Agreement.

 

(b)        Covenant
Not to Sue.  The Releasees agree not
to bring any action, suit or proceeding whatsoever (including the initiation of
governmental proceedings or investigations of any type) against any of the
Releasors for any matter or circumstance concerning which the Releasees have
released the Releasors under this Agreement. 
Further, the Releasees agree not to encourage any other person or
suggest to any other person that he, she or it institute any legal actions
against the Releasees.  The Company
represents and acknowledges that it has not heretofore assigned or transferred
or purported to assign or transfer, to any person or entity, any of the claims
described in paragraph 6, any portion thereof, or any interest therein.

 

7.          Consideration.  The consideration provided hereunder is not
required under the Company’s standard policies, and you know of no other
circumstances other than your agreeing to the terms of this Agreement that
would require the Company to provide such consideration.

 

8.          Legal
Advice; Reliance.  You represent and
acknowledge that (i) you have
been given adequate time to consider this Agreement and have voluntarily waived
the 21-day consideration period under ADEA, (ii)
have been advised to discuss all aspects of this Agreement with your private
attorney, (iii) you have
carefully read and fully understands all the provisions of this Agreement (iv) you have voluntarily entered into this
Agreement, without duress or coercion, and (v)
you have not heretofore assigned or transferred or purported to assign or
transfer, to any person or entity, any of the claims described in paragraph 5
hereof, any portion thereof, or any interest therein.  You understand that if you request additional
time to review the terms of this Agreement, a reasonable extension of time will
be granted.

 

9.          Confidentiality.  The parties to this Agreement agree not to
disclose its terms to any person, other than their attorneys, accountants,
financial advisors or, in your case, members of your immediate family; provided
that this paragraph 9 shall not be construed to prohibit any disclosure
required by law or in any proceeding to enforce the terms and conditions of
this Agreement.

 

10.        Non-Disparagement.  Effective as of the date hereof and at all
times thereafter, you hereby agree that the Releasors will not directly or
indirectly, engage in any conduct or make any statement, whether in commercial
or noncommercial speech, disparaging or criticizing in any way the Company or
any affiliate thereof, or any products or services offered by the Company, nor
will the Releasors engage in any other conduct or make any other statement that
could be reasonably expected to impair the

 

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goodwill of the Company,
or any affiliate thereof, the reputation or marketing of Company products, in
each case, except to the extent required by law, and then only after
consultation with the Company to the extent possible.  Effective as of the date hereof and at all
times thereafter, the Releasees hereby agree that they will not directly or
indirectly, engage in any conduct or make any statement, whether in commercial
or noncommercial speech, disparaging or criticizing you in any way, nor will
the Releasees engage in any other conduct or make any other statement that
could be reasonably expected to harm your reputation, personally or
professionally, in each case, except to the extent required by law, and then
only after consultation with you to the extent possible.

 

11.        Miscellaneous.

 

(a)        Third
Party Beneficiaries.  All Releasees
and Releasors under this Agreement who are not signatories to this Agreement
shall be deemed to be third party beneficiaries of this Agreement to the same
extent as if they were signatories hereto.

 

(b)        Withholding.  The Company shall withhold from any payments
made under this Agreement all federal, state, local or other applicable taxes
as shall be required by law.

 

(c)        Entire
Agreement.  This Agreement
constitutes the sole and complete understanding of you and the Company with
respect to the subject matter hereof. 
You and the Company represent to each other that in executing this Agreement,
you and the Company do not rely and have not relied upon any representation or
statement not set forth herein made by any other person, with regard to the
subject matter, basis or effect of this Agreement.

 

(d)        Amendment;
Waiver; Successors.  No amendment,
modification or alteration of the terms and provisions of this Agreement shall
be binding unless the same shall be in writing and duly executed by you and the
Company.  No waiver of any of the
provisions of this Agreement shall be deemed to or shall constitute a waiver of
any other provision hereof.  No delay on
the part of any party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof. 
This Agreement shall be binding upon the parties hereto and their respective
successors, transferees and assigns.

 

(e)        Governing
Law; Severability; Blue Pencil.  This
Agreement will be governed by the laws of the State of New York, without regard
to its conflict of laws rules (other than those that mandatorily apply).  In the event that any one or more of the
provisions of this Agreement is held to be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions will not
in any way be affected or impaired thereby. 
The parties hereto agree that the covenants incorporated into this
Agreement by paragraph 4 hereof are reasonable covenants under the
circumstances, and further agree that if, in the opinion of any court of
competent jurisdiction such covenants

 

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are not reasonable in any
respect, such court shall have the right, power and authority to exercise or
modify such provision or provisions of these covenants as to the court shall
appear not reasonable and to enforce the remainder of these covenants as so
amended.

 

(f)         Revocation.  You may revoke this Agreement within seven
(7) days after the date on which you sign this Agreement.  You understand that this Agreement is not
binding or enforceable until such seven (7) day period has expired.  Any such revocation must be made in a signed
letter executed by you and received by the Company at the following address no
later than 5:00 p.m., New York time, on the seventh day after you have executed
this agreement: Equinox Holdings, Inc., 895 Broadway, New York, New York  10003, Attention: Harvey J.
Spevak.  You understand that if you
revoke this Agreement, you will not be entitled to any payments or benefits
hereunder.

 

(g)        Further
Assurances.  Each party hereto agrees
with the other party hereto that it will cooperate with such other party and
will execute and deliver, or cause to be executed and delivered, all such other
instruments and documents, and will take such other actions, as such other
parties may reasonably request from time to time to effectuate the provisions
and purposes of this Agreement.

 

(h)        Counterparts.  This Agreement may be executed in
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall constitute the same instrument.  The parties hereto agree to accept a signed
facsimile copy of this Agreement as a fully binding original.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  EQUINOX
  HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  ACCEPTED AND AGREED

  	
   

  
	
  as of the date first written above:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Christopher Peluso

  	
   

  
						

 

6

 

Annex A

 

 

April   , 2005

 

 

To Whom It May Concern:

 

 

Chris Peluso served as Chief Operating Officer of
Equinox Holdings, Inc. from December 16, 2002 until January 7, 2005.  During Mr. Peluso’s tenure as COO, Equinox
opened 11 new locations including 2 in new markets, San Francisco and Chicago.

 

During that same time period, revenues for Equinox
Holdings increased by 52.7 %. 
Additionally, EBITDA during this time frame increased by 17.3 %, and
membership increased by 41.3 %.

 

Sincerely,

 

 

Harvey Spevak

Chief Executive Officer, Equinox Holdings, Inc.Exhibit 10.O

 

Exhibit O.

 

Description of Director Retirement Program

 

Non-management directors who were
elected prior to 1997 remain eligible to receive a one-time payment under our
Director Retirement Program, which was terminated at the end of 1996.  The amount of the payment is equal to the
present value of the product of the annual director’s fee in effect in 1996 ($25,000)
and the number of years of service through 1996.  The discount rate used to calculate the
present value is a corporate bond benchmark index in effect at the end of the
year prior to the year in which an eligible director retires.  The payment is made in February of the year
following retirement.

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