Document:

Exhibit 10.18

AMENDED AND RESTATED

SEVERANCE AGREEMENT

BETWEEN

CORNING NATURAL GAS CORPORATION

AND

KENNETH J. ROBINSON

THIS AGREEMENT, effective
as of the 18th day of August, 2006, by and between Corning
Natural Gas Corporation, a New York Corporation (the “Company”) and Kenneth J.
Robinson (the “Executive”).

WITNESSETH:

WHEREAS, the Executive is
a valuable employee of Corning Natural Gas Corporation, an integral part of its
management, and a key participant in the decision-making process relative to
planning and policy for the Company; and

WHEREAS, the Company and
the Executive previously entered into that certain Severance Agreement on
December 17, 1999 and the Amended and Restated Severance Agreement January 14,
2000 (the “2000 Agreement” as amended by amendments dated May 2, 2006 and July
28, 2006); and

WHEREAS, the Company and
the Executive desire to amend and restate the terms and provisions of the 2000 Agreement
as amended;

NOW THEREFORE, it is hereby agreed by and between the parties hereto as
follows:

1.            Definitions.

(a)           “Board”
shall mean the Board of Directors of the Company.

(b)           “Cause”
shall have the same meaning as is provided in the Executive’s Employment
Agreement.

(c)           “Change
in Control” shall mean a change in control that is both (1) a change in control
within the meaning of Code Section 409A and (2) a change in control that
satisfies the following requirements:

(i)            any
person (as such term is used in Section 13(d) of the Securities Exchange Act of
1934 (the “1934 Act”)), excluding a corporation at least 90% of the ownership
of which after acquiring its interest is owned directly by the holder of common
shares of the Company immediately prior to such acquisition

 

(“Person”), becomes the
beneficial owner, directly or indirectly, of twenty (20) percent or more of the
outstanding common shares of the Company (other than the Savings Plan)
requiring the filing of a report with the Securities and Exchange Commission
under Section 13(d) of the 1934 Act;

(ii)           a
purchase by any Person of shares pursuant to a tender or exchange offer to
acquire any common shares of the Company (or securities convertible into common
shares) for cash, securities, or any other consideration provided that, after
consummation of the offer, such Person is the beneficial owner (as defined in
Rule l3d-3 under the 1934 Act), directly or indirectly, of twenty (20)
percent or more of the outstanding common shares of the Company (calculated as
provided in paragraph (d) of Rule 13d-3 under
the 1934 Act in the case of rights to acquire common shares);

(iii)          approval
by the shareholders of the Company of (a) any consolidation or merger of the
Company in which the Company is not the continuing or
surviving corporation or pursuant to which common shares of the Company would
be converted into cash, securities, or other property, other than a
consolidation or merger of the Company in which holders of its common shares
immediately prior to the consolidation or merger own at least 90% of the common
shares of the surviving corporation immediately after the consolidation or
merger, or (b) any consolidation or merger in which the Company is the
continuing or surviving corporation but in
which the common shareholders of the Company immediately prior to the
consolidation or merger do not hold at
least 90% of the outstanding common shares of the continuing or surviving
corporation (except where such holders of common stock hold at least 90% of the
common shares of the corporation which owns all of the common shares of the
Company), or (c) any sale, lease, exchange, or other transfer (in one
transaction or a series of related transactions) of all or substantially all
the assets of the Company, or (d) any merger or consolidation of the Company
where, after the merger or consolidation, one Person owns 100% of the common
shares of the Company (except where the common holders of the Company’s common
shares immediately prior to such merger or consolidation own at least 90% of
the outstanding common shares of such Person immediately after such merger or
consolidation) (upon the Board’s determination that the transaction subject to
shareholder approval hereunder will not be consummated, a Change in Control
shall not be deemed to

 2
 

 

have occurred from
such date forward and this Agreement shall continue in effect as if no Change
in Control had occurred, except to the extent termination requiring Severance
Benefits under paragraph 3 hereof has occurred prior to such Board’s
determination); or

(iv)          a
change in the majority of the members of the Board within a 24- month period
unless the election or nomination for election or nomination for election by
the Company’s common shareholders of each new director was approved by the vote
of at least two-thirds of the Directors then still in office who were in office
at the beginning of the 24-month period.

(d)           “Code”
shall mean the Internal Revenue Code of 1986, as amended.

(e)           “Compensation”
shall mean the sum of (i) the Executive’s annual rate of base salary on the
last day the Executive was an employee of the Company (or if higher, the annual
rate in effect on the date of the Change in Control), including any elective
contributions made by the Company on behalf of the Executive that are not
includible in the gross income of the Executive under Sections 125 or 402(a)(8)
of the Code or any successor provision thereto, (ii) any and all amounts to be
paid to the Executive annually for membership on the Board of Directors or any
Committee thereof, and (iii) the average of the annual incentive payments paid
to the Executive by the Company, if any, for the three consecutive calendar
years immediately preceding employment termination (or a lesser period if the
Executive was not eligible to receive annual incentive payments during such
three year period).

(f)           “Coverage
Period” means the period beginning on the Starting Date and ending on the
Ending Date.

(g)           “Disability”
shall be a disability as this term is defined in Section 409A.

(h)           “Employment
Agreement” shall mean the Amended and Restated Employment Agreement between the
Company and the Executive, entered into of even date hereof, together with any
amendments thereto.

(i)            “Ending
Date” means the earlier of (i) the date of the Board’s determination that the
transaction which was approved by the Company’s shareholders, thus constituting
a Change in Control pursuant to paragraph 1(c)(iii), will not be consummated,
or (ii) the date which is 36 full calendar months following the date on which a
Change in Control occurs or, if a Change in Control is based on shareholder
approval pursuant to paragraph 1(c)(iii) hereof, the date which is 36 full

 3
 

 

calendar months following
the date of the consummation of the transaction which was the subject of shareholder approval.

(j)             “Good
Reason” shall mean any of the following:

(i)            material
change by the Company of the Executive’s functions, duties or responsibilities
which change would cause the Executive’s position with the Company to become of
less dignity, responsibility, importance, prestige or scope, including, without
limitation, a change from being a senior officer of a publicly held company;

(ii)           assignment
or reassignment by the Company of the Executive without the Executive’s consent
to another place of employment more than 50 miles from the Executive’s current
place of employment; or

(iii)          a
reduction which is more than de minimis in the Executive’s base pay or bonus
opportunity except if such reduction is part of a reduction for all executive
officers of the Company and any parent Company thereof.

No such event described above shall constitute Good Reason
unless the Executive gives written notice to the Company, specifying the event
relied upon for such termination and given at any time within one year after
the occurrence of such event and the
Company has not remedied such within 30 days of the notice. The Company and
Executive, upon mutual written agreement may waive any of the foregoing
provisions which would otherwise constitute a Good Reason.

(k)           “Single
Trigger Period” means the eighteen month period which (i) begins on the date on
which a Change in Control occurs, or if a Change in Control is based on
shareholder approval pursuant to paragraph 1(c)(iii) hereof, the date of the
consummation of the transaction which was the subject of shareholder approval,
and (ii) ends eighteen months thereafter.

(1)           “Starting
Date” means the date on which a Change
in Control occurs.

2.             Term.
This Agreement shall be effective as of the date above written and shall
continue thereafter for 36 full calendar months following the date of an
occurrence of a Change in Control or, if
the Change in Control event is based on shareholder approval pursuant to paragraph
1(c)(iii), 36 full calendar

 4
 

 

months following
the date of the consummation of the transaction which was the subject of
shareholder approval.

3.             Severance
Benefit. If (i) at any time during the Coverage Period, the Executive’s
employment hereunder is terminated by the Company for any reason other than
Cause, death or Disability, or by the Executive for Good Reason, or (ii) during
the Single Trigger Period, the Executive terminates his employment for any
reason, then,

(a)           within
five business days after such termination, the Company shall pay to the
Executive (or, if the Executive has died before receiving all payments to which
the Executive has become entitled hereunder, to the estate of the Executive)
(i) accrued but unpaid salary and accrued but unused vacation, if any, and (ii)
severance pay in a lump sum cash amount equal to three (3) times the Executive’s
Compensation.

Notwithstanding
the five-business-days-payment requirement, if at the time of Executive’s
termination final IRS guidance on Section 409A provides that payments under
agreements of this nature are considered to be made on account of termination
of employment rather than on account of a change in control, the payments, or
the portion of them under this Agreement considered to be made on account of
termination, if lesser, shall be deferred until six months following the
Executive’s termination date; and

(b)           to
the extent not paid or payable under such plans and/or arrangements, the
Company shall pay to the Executive the present value of the benefits
(calculated assuming the Executive will begin receiving benefits at the
earliest retirement date under such plans and/or arrangements, or if later, at
the end of the term of this Agreement, based on the actuarial assumptions used
for purposes of the qualified defined benefit plan) that would have accrued,
but did not accrue, under the Company’s qualified defined benefit retirement
plan, the Corning Natural Gas Company Survivor Benefit Deferred Compensation
Agreement, and the excess pension benefit provision in the Employment Agreement
and/or any successor or similar plan(s) or arrangements in place and
operational on the date of termination and/or the Change in Control, as if (for
vesting, benefit accrual, eligibility for early retirement, subsidized early
retirement factors, actuarial equivalence, and any other purposes) the
Executive had continued to be employed and had continued to participate in such
plans and arrangements until the age of 62; it being understood by all parties
hereto that payments made under this Agreement and the deemed additional
credited service shall not be considered for purposes of determining the actual
benefit payable under the terms of such plans and arrangements and shall not be
considered

 5
 

 

part of the
relevant payroll records for purposes of such plans and arrangements; and

(c)           to
the extent not already provided under the terms of the Employment Agreement,
for a period commencing with the month in which termination of employment, as
described in paragraph 3 hereof, shall have occurred, and ending the later of
the date of the Executive’s or the Executive’s spouse’s death, the Executive,
his spouse and any dependents shall continue to be entitled to receive all
health and dental care benefits under the Company’s welfare benefit plans
(within the meaning of Section 3(l) of the Employee Retirement Income Security
Act of 1974, as amended), at no cost to the Executive and at the same level of
benefits that the Executive, his spouse and his dependents were receiving or
were entitled to receive at the time of termination of employment or, if it
would result in greater benefits, at the date of the Change in Control (if and
to the extent that such benefits shall not be payable or provided under any
Company plan, the Company shall pay or provide equivalent benefits on an
individual basis).

(d)           Any Common Shares of the Company granted
by the Company or a Company subsidiary to the Executive under the terms of any
Long-Term Incentive Plan (“Long-Term Incentive Plan”) as is in effect and as
may be amended from time to time, or any other comparable plan that may be put
into effect, subject to a risk of forfeiture, such as the satisfaction of
selected performance criteria or the Executive’s completion of a stated period
of employment, shall be fully vested and transferable by the Executive
following the Change in Control pursuant to the terms of any applicable plan.

(e)           The Company shall continue to maintain a
whole life insurance policy on the Executive until the Executive reaches the
age of 65.  The premiums for such policy
shall be paid for by the Company, however, 
the Executive (or the beneficiary designated by him) shall be the
beneficial owner of the policy.

4.              Certain
Additional Payments/Cap on Payments/Timing
of Payments.

If, and only if, the
pending acquisition of the Company by C&T Enterprises, Inc. (“C&T”) is
consummated, the procedures and payments set forth in section 4(e) below shall
apply.

(a)           If
Independent Tax Counsel shall determine that the aggregate payments made to the Executive pursuant to this Agreement and any other payments to the Executive from the
Company which constitute

 6
 

 

“parachute
payments” as defined in Section 280G of the Code (or any successor provision
thereto) (“Parachute Payments”) would be subject to the excise tax imposed by
Section 4999 of the Code (the “Excise Tax”), then the Executive shall be
entitled to receive an additional payment (a “Gross-Up Payment”) in an amount
(determined by Independent Tax Counsel) such that after payment by the
Executive of all taxes (including any Excise Tax) imposed upon the Gross-Up
Payment and any interest or penalties imposed with respect to such taxes, the
Executive retains from the Gross-Up Payment an amount equal to the Excise Tax
imposed upon the payments. For purposes of this paragraph 4(a), “Independent
Tax Counsel” shall mean a lawyer, a certified public accountant with a
nationally or regionally recognized accounting firm, or a compensation
consultant with a nationally recognized actuarial and benefits consulting firm,
with expertise in the area of executive compensation tax law, who shall be
selected by the Executive and shall be reasonably acceptable to the Company,
and whose fees and disbursements shall be paid by the Company.

(b)           If
Independent Tax Counsel shall determine that no Excise Tax is payable by the
Executive, it shall furnish the Executive with a written opinion that the
Executive has substantial authority not to report any Excise Tax on the
Executive’s Federal income tax return. 
If the Executive is subsequently required to make a payment of any
Excise Tax, then the Independent Tax Counsel shall determine the amount (the
amount of such additional payments are referred herein as “Gross-Up
Underpayment”) of such payment and any such Gross-Up Underpayment shall be
promptly paid by the Company to or for the benefit of the Employee.  The fees and disbursements of the Independent
Tax Counsel shall be paid by the Company.

(c)           The Executive shall notify the Company in
writing within 15 days of any claim by the Internal Revenue Service that, if
successful, would require the payment by the Company of a Gross-Up
Payment. If the Company notifies the Executive in writing that it desires to
contest such claim and that it will bear the costs and provide the
indemnification as required by this sentence, the Executive shall:

 (i)           give
the Company any information reasonably requested by the Company relating to
such claim,

(ii)           take
such action in connection with contesting such claim
as the Company shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with respect to
such claim by an attorney reasonably selected by the Company,

 7
 

 

(iii)          cooperate
with the Company in good faith in order to effectively contest such claim, and

(iv)         permit
the Company to participate in any proceedings
relating to such claim; provided, however, that the Company shall bear and pay
directly all costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and hold the
Executive harmless, on an after-tax basis, for any Excise Tax or income
tax, including interest and penalties with respect thereto, imposed as a result
of such representation and payment of costs and expenses. The Company shall
control all proceedings taken in connection with such contest; provided,
however, that if the Company directs the Executive to pay such claim and sue for
a refund, the Company shall advance the amount of such payment to the
Executive, on an interest-free basis and shall indemnify and hold the Executive
harmless, on an after-tax basis, from any Excise Tax or income tax,
including interest or penalties with respect thereto, imposed with respect to
such advance or with respect to any imputed income with respect to such
advance.

(d)           If,
after the receipt by the Executive of an amount advanced by the Company
pursuant to paragraph 4(c)(iv), the Executive becomes entitled to receive any
refund with respect to such claim, the Executive shall, within 10 days, pay to
the Company the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto).

(e)           Severance Payments under the Amended and
Restated Severance Agreement shall be paid, with interest at 8% per annum,
thirty (30) days after the consummation of the proposed merger with C&T
Enterprises, Inc., or an affiliate thereof (“C&T”), unless C&T obtains
a final determination of fraud having been committed by Executive with respect
to the relevant representations and warranties set forth in the said Merger
Agreement. Such determination of fraud shall be made by a court of competent
jurisdiction.

Executive’s severance
payments hereunder shall be reduced by $87,870, plus an amount sufficient, when
combined with the amount of a similar reduction in benefits by the Company’s
other executive who is entering an Amended and Restated Severance Agreement
this day, and

 8
 

 

combined with the reduction
in taxes the Company is obliged to pay pursuant to Internal Revenue Code
section 280G that results from the aforesaid reduction in severance payments,
equals the amount that Corning’s transaction costs, relating to the merger with
C&T (the “Transaction Costs”) exceed $1,075,000, but in no event shall such
Transaction Costs reduction exceed $112,500. The determination of such amount
shall be made five (5) days before the scheduled Closing for the acquisition of
the Company by C&T.

To the extent that Executive
incurs tax obligations on the severance payments that Executive has foregone,
Executive shall waive any right he has to reimubrsement thereof by the Company.

5.             No
Mitigation Required. In the event of any termination of the Executive’s
employment described in paragraph 3, the Executive shall be under no obligation
to seek other employment, and there shall be no offset against amounts due the
Executive under this Agreement on account of any remuneration attributable to
any subsequent employment; provided, however, to the extent the Executive
receives medical and health benefits from a subsequent employer, medical and
health benefits under paragraph 3(c) shall be secondary to those received from
the subsequent employer, and shall be required only to the extent not provided
by such subsequent employer.

6.             Source
of Payments. All payments provided for in this Agreement shall be paid in
cash from the general funds of the Company; provided, however, such payments
shall be reduced by the amount of any
payments made to the Executive or the Executive’s dependents, beneficiaries, or
estate from any trust or special or separate fund established by the Company to
assure such payments. The Company shall not be required to establish a special
or separate fund or other segregation of assets to assure such payments, and,
if the Company shall make any investments to aid it in meeting its obligations
hereunder, the Executive shall have no right, title, or interest whatever in or
to any such investments except as may otherwise be expressly provided in a
separate written instrument relating to such investments. Nothing contained in
this Agreement, and no action taken pursuant to its provisions, shall create or
be construed to create a trust of any kind, or a fiduciary relationship between
the Company and the Executive or any other person. To the extent that any
person acquires a right to receive payments from the Company, such right shall
be no greater than the right of an unsecured creditor of the Company.

7.             Litigation
Expenses: Arbitration.

(a)           Full
Settlement, Litigation Expenses; Arbitration. 
The Company’s obligation to make the payments provided for in this
Agreement and

 9
 

 

otherwise to
perform its obligations hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the
Company may have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any other action by way
of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement. The Company agrees to pay, upon written demand
therefor by the Executive, all legal fees and expenses which the Executive may
reasonably incur as a result of any dispute or contest by or with the Company
or others regarding the validity or enforceability of, or liability under, any
provision of this Agreement (except to the extent it is determined by a court
of competent jurisdiction, mediator or arbitrator, as the case may be, that the
Executive’s material claim is, or claims are, frivolous or without merit in
which case the Executive shall bear all such fees and expenses), together with
interest on any delayed payments at the applicable Federal rate provided for in
Section 7872(f)(2) of the Code. In any such action brought by the Executive for
damages or to enforce any provisions of this Agreement, the Executive, in his
sole discretion, shall be entitled to seek both legal and equitable relief and
remedies, including, without limitation, specific performance of the Company’s
obligations hereunder. If the parties hereto so agree in writing, any disputes
under this Agreement may be settled by arbitration. The obligation of the
Company under this paragraph 7 shall survive the termination for any reason of
this Agreement (whether such termination is by the Company, by the Executive,
upon the expiration of this Agreement or otherwise).

(b)           In
the event of any dispute or difference between the Company and the Executive
with respect to the subject matter of this Agreement and the enforcement of
rights hereunder, the Executive may, in the Executive’s sole discretion by
written notice to the Company, require such dispute or difference to be
submitted to arbitration. The arbitrator or arbitrators shall be selected by
agreement of the parties or, if they cannot agree on an arbitrator or
arbitrators within 30 days after the Executive has notified the Company of
Executive’s desire to have the question settled by arbitration, then the
arbitrator or arbitrators shall be selected by the American Arbitration
Association (the “AAA”) in Rochester, New York upon the application of the
Executive. The determination reached in such arbitration shall be final and
binding on both parties without any right of appeal or further dispute.
Execution of the determination by such arbitrator may be sought in any court of
competent jurisdiction. The arbitrators shall not be bound by judicial
formalities and may abstain from following the strict rules of evidence and
shall interpret this Agreement as an honorable engagement and not merely as a
legal obligation. Unless otherwise agreed by the parties, any such arbitration

 10
 

 

shall take place
in Rochester, New York, and shall be conducted in accordance with the Rules of
the AAA.

8.             Income
Tax Withholding. The Company may withhold from any payments made under this
Agreement all federal, state, or other taxes as shall be required pursuant to
any law or governmental regulation or ruling.

9.             Entire
Understanding. This Agreement contains the entire understanding between the
Company and the Executive with respect to the subject matter hereof and
supersedes any similar agreement between the Company and the Executive, except
that this Agreement shall not affect or operate to reduce any benefit or
compensation inuring to the Executive of any kind elsewhere provided and not
expressly provided for in this Agreement including, without limitation, any
benefit or compensation under the Employment
Agreement and/or the Corning Natural Gas Company Amended and Restated Survivor
Benefit Deferred Compensation Agreement.

10.           Severability.
If, for any reason, any one or more of the provisions or part of a provision
contained in this Agreement shall be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision or part of a provision of this Agreement
not held so invalid, illegal or unenforceable, and each other provision or part
of a provision shall to the full extent consistent with law continue in full
force and effect.

11.           Consolidation,
Merger. or Sale of Assets. If the Company consolidates or merges into or
with, or transfers all or substantially all of its assets to, another entity
the term “the Company” as used herein shall mean such other entity and this
Agreement shall continue in full force and effect.

12.           Notices.
All notices, requests, demands and other communications required or permitted
hereunder shall be given in writing and shall be deemed to have been duly given
if delivered or mailed, postage prepaid, first class as follows:

a.             to
the Company;

Corning Natural Gas
Company

330 West William Street

P.O. Box 58

Corning, New York 14830

Attention: President

With a copy to:

Eric J. Krathwohl, Esq.

 11
 

 

Rich May, a Professional
Corporation

176 Federal Street

Boston, MA 
02110

b.            to
the Executive:

Kenneth J.
Robinson

46 Wilson Street

Corning, NY  14830

or to such other address as either party shall have
previously specified in writing to the other.

13.           No
Attachment.  Except as required by
law, no right to receive payments under this Agreement shall be subject to
anticipation, commutation, alienation, sale, assignment, encumbrance, charge,
pledge or hypothecation or to execution, attachment, levy or similar process or
assignment by operation of law, and any attempt, voluntary or involuntary, to
effect any such action shall be null, void and of no effect.

14.         Binding
Agreement.  This Agreement shall be
binding upon, and shall inure to the benefit of, the Executive and the Company and
their respective permitted successors and assigns.

15.         Modification
and Waiver. Prior to the date of a Change in Control, this Agreement may be
terminated, modified, amended or terminated by action of a majority of the
members of the Board. After a Change in Control, this Agreement may not be
modified or amended except by an instrument in writing signed by the parties
hereto. No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel
against the enforcement of any provision of this Agreement, except by written
instrument signed by the party charged with such waiver or estoppel. No such
written waiver shall be deemed a continuing waiver unless specifically stated
therein, and each such waiver shall operate only as to the specific term or
condition waived and shall not constitute a waiver of such term or condition
for the future or as to any act other than that
specifically waived.

Notwithstanding
the foregoing, this Agreement may not be terminated nor may benefits be paid
following termination except in accordance with the terms and conditions of
Code Section 409A and regulations thereunder.

16.         Heading
of No Effect.  The paragraph headings
contained in this Agreement are included solely for convenience of reference
and shall not in any way affect the meaning or interpretation of any of the
provisions of this Agreement.

 12
 

 

17.         Governing
Law. This Agreement and its validity, interpretation, performance, and
enforcement shall be governed by the laws of the State of New York without
giving effect to the choice of law provisions in the State of New York.

18.         Code
Section 409A.

(1)       No Acceleration. Neither the form of benefit may be changed
nor the time of commencement may be accelerated except as expressly provided in
this Agreement, including the Section 409A amendment to it, between the
parties, and neither party shall have the discretion to accelerate payments.

(2)       Intent to Comply with Section 409A. This Agreement is
intended to comply with Code Section 409A to the extent that its provisions are
subject thereto. The Company has adopted good faith amendments necessary to
bring the Agreement into compliance with the terms of this Section as
interpreted by guidance issued by the Internal Revenue Service. To the extent
the terms of the Agreement or any amendment fail to qualify for exemption from
or satisfy the requirements of Code Section 409A, the Agreement may be operated
in compliance with Code Section 409A pending further amendment to the extent
authorized by the Internal Revenue Service. In such circumstances the Agreement
and any amendment will be administered in a manner which adheres as closely as
possible to their existing terms while complying with Code Section 409A.

19.         Company
Counsel.  The parties recognize and
agree that Rich May, a Professional Corporation is acting as counsel solely to
the Company and not to the Executive. 
Executive agrees and states that he has been specifically advised of
that fact and that he has had the opportunity to engage his own counsel for the
negotiation and drafting of this Agreement.

IN WITNESS WHEREOF, the Company has caused this
Agreement to be executed by its officers thereunto duly authorized, and the
Executive has signed this Agreement, all effective as of the date first above
written.

	
  Witness:

  	
   

  	
  Corning Natural Gas Corporation:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Stanley G. Sleve

  	
   

  	
   

  	
  By:

  	
  /s/ Thomas K.
  Barry

  	
   

  
	
   

  	
   

  	
  Title:

  	
     President & CEO

  	
   

  
	
   

  	
   

  	
   

  
	
  Witness:

  	
   

  	
  Executive:

  
	
   

  	
   

  	
   

  
	
  /s/ Stanley G. Sleve

  	
   

  	
   

  	
  /s/ Kenneth
  J.Robinson

  	
   

  
	
   

  	
   

  	
  Kenneth J. Robinson

  
									

 

 13Exhibit 10.1

Management
Stock Option Agreement

This Management Stock
Option Agreement, dated as of August 15, 2006 (the “Grant Date”),
between Hertz Global Holdings, Inc., a Delaware corporation, and Mark P.
Frissora (the “Executive”), is being entered into pursuant to the Hertz
Global Holdings, Inc. Stock Incentive Plan. 
The meaning of capitalized terms may be found in Section 7.

The Company and the Executive hereby agree as follows:

Section 1.                                           Grant
of Options

(a)                                  Confirmation
of Grant.  The Company hereby
evidences and confirms, effective as of the date hereof, its grant to the
Executive of Options to purchase the number of Common Shares specified on the
signature page hereof.  The Options are
not intended to be incentive stock options under the Code.  This Agreement is entered into pursuant to,
and the terms of the Options are subject to, the terms of the Plan.  If there is any inconsistency between this
Agreement and the terms of the Plan, the terms of this Agreement shall govern.

(b)                                 Option
Price.  Each share covered by an
Option shall have the respective Option Price specified on the signature page
hereof.

Section 2.                                           Vesting
and Exercisability

(a)                                  In
General.  Except as otherwise
provided in Section 2(b), Section 2(c) and Section 6 of this Agreement, the
Options shall become vested and exercisable in five equal annual installments
on each of the first through fifth anniversaries of the Grant Date (each, a “Vesting
Date”), subject to the continuous employment of the Executive with the
Company until the applicable Vesting Date for such annual installment to so
vest.

(b)                                 Certain
Terminations of Employment.  If the
Company terminates the Executive’s employment Without Cause or the Executive
terminates his employment with the Company for Good Reason, a pro rata portion
of that number of Options that would otherwise vest on the next Vesting Date
(if any) will vest and become exercisable as of the effective date of such
termination of employment, such pro rata portion to be based on the number of
full or partial months elapsed from the anniversary of the Grant Date
immediately preceding the effective date of such termination of employment
through and including the effective date of such termination of employment.

 

(c)                                  Discretionary
Acceleration.  The Board, in its sole
discretion, may accelerate the vesting or exercisability of all or a portion of
the Options, at any time and from time to time.

(d)                                 Exercise.  Once vested in accordance with the provisions
of this Agreement, the Options may be exercised at any time and from time to
time prior to the date such Options terminate pursuant to Section 3.  Options may only be exercised with respect to
whole Common Shares and must be exercised in accordance with Section 4.

Section 3.                                           Termination
of Options

(a)                                  Normal
Termination Date.  Unless earlier
terminated pursuant to Section 3(b) or Section 6, the Options shall terminate
on the tenth anniversary of the Grant Date (the “Normal Termination Date”),
if not exercised prior to such date.

(b)                                 Early
Termination.  Subject to Section
6(c), if the Executive’s employment with the Company terminates for any reason,
any Options held by the Executive that have not vested before the effective
date of such termination of employment (determined without regard to any
statutory or deemed or express contractual notice period) or that do not become
vested on such date in accordance with Section 2 shall terminate immediately
upon such termination of employment (determined without regard to any statutory
or deemed or express contractual notice period) and, if the Executive’s
employment is terminated by the Company for Cause, all Options (whether or not
then vested or exercisable) shall automatically terminate immediately upon such
termination.  All vested Options held by
the Executive following the effective date of a termination of employment shall
remain exercisable until the first to occur of (i) the 60th day following the effective date of the
Executive’s voluntary termination of employment without Good Reason (determined
without regard to any deemed or express statutory or contractual notice
period), (ii) the 90th day following the effective date of the
Executive’s termination of employment for Good Reason or the Company’s
termination of the Executive’s employment Without Cause, (iii) the 180th
day in the case of a Special Termination or a retirement from active service on
or after the Executive reaches normal retirement age, (iv) the Normal
Termination Date or (v) the cancellation of the Options pursuant to
Section 6(a), and if not exercised within such period the Options shall
automatically terminate upon the expiration of such period.

 2
 

 

Section 4.                                           Manner
of Exercise

(a)                                  General.  Subject to such reasonable administrative
regulations as the Board may adopt from time to time, the Executive may exercise
vested Options by giving at least 15 business days prior written notice to the
Secretary of the Company specifying the proposed date on which the Executive
desires to exercise a vested Option (the “Exercise Date”), the number of
whole Common Shares with respect to which the Options are being exercised (the “Exercise
Shares”), the applicable per share Option Price and the aggregate Option
Price for such Exercise Shares (the “Exercise Price”); provided
that following a Public Offering notice may be given within such lesser period
as the Board may permit.  On or before
any Exercise Date that occurs prior to a Public Offering, the Company and the
Executive shall enter into a management stock subscription agreement that
contains transfer and other restrictions on the Exercise Shares as are provided
in the Management Stock Subscription Agreement. 
Unless otherwise determined by the Board, and subject to such other
terms, representations and warranties as may be provided for in the Management
Stock Subscription Agreement, (i) on or before the Exercise Date the
Executive shall deliver to the Company full payment for the Exercise Shares in
United States dollars in cash, or cash equivalents satisfactory to the Company,
in an amount equal to the Exercise Price plus any required withholding
taxes or other similar taxes, charges or fees and (ii) the Company shall
register the issuance of the Exercise Shares on its records (or direct such
issuance to be registered by the Company’s transfer agent); provided
that, following a Public Offering, the Executive may direct that the Company
withhold a number of Exercise Shares having a Fair Market Value the time of
exercise equal to the minimum statutory withholding tax requirements.  The Company may require the Executive to furnish
or execute such other documents as the Company shall reasonably deem necessary
(i) to evidence such exercise, (ii) to determine
whether registration is then required under the Securities Act or other
applicable law or (iii) to comply with or satisfy the requirements
of the Securities Act, applicable state or non-U.S. securities laws or
any other law.

(b)                                 Restrictions
on Exercise.  Notwithstanding any
other provision of this Agreement, the Options may not be exercised in whole or
in part, and no certificates representing Exercise Shares shall be delivered, (i) (A)
unless all requisite approvals and consents of any governmental authority of
any kind shall have been secured, (B) unless the purchase of the
Exercise Shares shall be exempt from registration under applicable U.S. federal
and state securities laws, and applicable non-U.S. securities laws, or the
Exercise Shares shall have been registered under such laws, and (C) unless
all applicable U.S. federal, state and local and non-U.S. tax withholding requirements
shall have been satisfied or (ii) if such exercise would result in
a violation of the terms or provisions of or a default or an event of default
under, any of the Company’s financing agreements.  The

 3
 

 

Company shall use its
commercially reasonable efforts to obtain any consents or approvals referred to
in clause (i) (A) of the preceding sentence, but shall otherwise have no
obligations to take any steps to prevent or remove any impediment to exercise
described in such sentence.

(c)                                  Registration;
Broker-Assisted Exercise.  The
Company shall use its reasonable best efforts (A) to cause a registration of
Common Shares under this Option, pursuant to a duly filed Form S-8, in
connection with an initial Public Offering (as defined under the Plan) and (B)
upon the lapse of any underwriters’ lock-up period following such initial
Public Offering, to implement a broker-assisted exercise program.

Section 5.                                           Executive’s
Representations; Investment Intention. 
The Executive represents and warrants that the Options have been, and
any Exercise Shares will be, acquired by the Executive solely for the Executive’s
own account for investment and not with a view to or for sale in connection
with any distribution thereof.  The
Executive represents and warrants that the Executive understands that none of
the Exercise Shares may be transferred, sold, pledged, hypothecated or
otherwise disposed of unless the provisions of the related Management Stock Subscription Agreement
shall have been complied with or have expired.

Section 6.                                           Change
in Control

(a)                                  Vesting
and Cancellation.  Except as
otherwise provided in this Section 6(a), in the event of a Change in Control,
all then-outstanding Options (whether vested or unvested) shall be canceled in
exchange for a payment having a value equal to the excess, if any, of (i)
the product of the Change in Control Price multiplied by the aggregate number
of shares (whether vested or unvested) covered by all such Options immediately
prior to the Change in Control over (ii) the aggregate Option Price for
all such shares, to be paid as soon as reasonably practicable, but in no event
later than 30 days following the Change in Control.

(b)                                 Alternative
Award.  Notwithstanding Section 6(a),
the Options shall vest in full, and no cancellation, termination, or settlement
or other payment shall occur with respect to any Option, if the Board
reasonably determines prior to the Change in Control that the Executive shall
receive an Alternative Award meeting the requirements of the Plan.

(c)                                  Certain
Terminations Prior to a Change of Control. 
If the Executive’s employment with the Company is terminated at any time
within the six month period immediately preceding the occurrence of a Change in
Control in either a termination by the Company Without Cause or a termination
by the

 4
 

 

Executive for Good
Reason, for purposes of this Agreement, the Executive’s employment shall be
deemed to have terminated immediately after the Change in Control.

Section 7.                                           Certain
Definitions.  As used in this
Agreement, capitalized terms that are not defined herein have the respective
meaning given in the Plan, and the following additional terms shall have the
following meanings:

“Agreement” means
this Management Stock Option Agreement, as amended from time to time in
accordance with the terms hereof.

“Cause” has the
meaning given in the Employment Agreement.

“Code” means the
United States Internal Revenue Code of 1986, as amended, and any successor
thereto.

“Company” means
Hertz Global Holdings, Inc., provided that for purposes of determining
the status of Executive’s employment with the “Company,” such term shall
include the Company and its Subsidiaries.

“Determination Date”
means the effective date of the Executive’s termination of employment.

“Employment Agreement”
means the Employment Agreement, dated as of July __, 2006, between the
Executive and the Company, as amended from time to time.

“Executive” means
the grantee of the Options, whose name is set forth on the signature page of
this Agreement; provided that for purposes of Section 4 and Section 8,
following such person’s death “Executive” shall be deemed to include such
person’s beneficiary or estate and following such Person’s Disability,
“Executive” shall be deemed to include such person’s legal representative.

“Exercise Date”
has the meaning given in Section 4(a).

“Exercise Price”
has the meaning given in Section 4(a).

“Exercise Shares”
has the meaning given in Section 4(a).

“Good Reason” has
the meaning given in the Employment Agreement.

 5
 

 

“Grant Date” means
the date hereof, which is the date on which the Options are granted to the
Executive.

“Management Stock
Subscription Agreement” means the form of management stock subscription
agreement attached as an exhibit to the Employment Agreement.

“Normal Termination
Date” has the meaning given in Section 3(a).

“Option” means the
right granted to the Executive hereunder to purchase one Common Share for a
purchase price equal to the Option Price subject to the terms of this Agreement
and the Plan.

“Option Price”
means, with respect to each Common Share covered by an Option, the purchase
price specified in Section 1(b) for which the Executive may purchase such
Common Share upon exercise of an Option.

“Plan” means the
Hertz Global Holdings, Inc. Stock Incentive Plan.

“Securities Act”
means the United States Securities Act of 1933, as amended, or any successor
statute, and the rules and regulations thereunder that are in effect at the
time, and any reference to a particular section thereof shall include a
reference to the corresponding section, if any, of such successor statute, and
the rules and regulations.

“Special Termination”
means a termination of the Executive’s employment as a result of his death or
Disability.

“Vesting Date” has
the meaning given in Section 2(a).

“Without Cause” has
the meaning given in the Employment Agreement.

Section 8.                                           Miscellaneous.

(a)                                  Withholding.  Subject to Section 4(a), the Company or one
of its Subsidiaries may require the Executive to remit to the Company an amount
in cash sufficient to satisfy any applicable U.S. federal, state and local and
non-U.S. tax withholding or other similar charges or fees that may arise in
connection with the grant, vesting, exercise or purchase of the Options.

(b)                                 Authorization
to Share Personal Data.  The
Executive authorizes any Affiliate of the Company that employs the Executive or
that otherwise has or lawfully obtains personal data relating to the Executive
to divulge or transfer such

 6
 

 

personal data to the
Company or to a third party, in each case in any jurisdiction, if and to the
extent appropriate in connection with this Agreement or the administration of
the Plan.

(c)                                  No
Rights as Stockholder; No Voting Rights. 
The Executive shall have no rights as a stockholder of the Company with
respect to any Shares covered by the Options until the exercise of the Options
and delivery of the Shares.  No
adjustment shall be made for regular dividends or other rights for which the
record date is prior to the delivery of the Shares.  Any Shares delivered in respect of the
Options shall be subject to the Management Stock Subscription Agreement and the
Executive shall have no voting rights with respect to such Shares until such
time as specified in the Executive Stock Subscription Agreement.

(d)                                 No
Right to Continued Employment. Nothing in this Agreement shall be deemed to
confer on the Executive any right to continue in the employ of the Company or
any Subsidiary, or to interfere with or limit in any way the right of the
Company or any Subsidiary to terminate such employment at any time.

(e)                                  Non-Transferability
of Options.  The Options may be
exercised only by the Executive.  The
Options are not assignable or transferable, in whole or in part, and they may
not, directly or indirectly, be offered, transferred, sold, pledged, assigned,
alienated, hypothecated or otherwise disposed of or encumbered (including, but
not limited to, by gift, operation of law or otherwise) other than by will or
by the laws of descent and distribution to the estate of the Executive upon the
Executive’s death or with the Company’s consent.

(f)                                    Notices.  All notices and other communications required
or permitted to be given under this Agreement shall be in writing and shall be
deemed to have been given if delivered personally or sent by certified or
express mail, return receipt requested, postage prepaid, or by any recognized
international equivalent of such delivery, to the Company or the Executive, as
the case may be, at the following addresses or to such other address as the
Company or the Executive, as the case may be, shall specify by notice to the
other:

(i)                    if
to the Company, to it at:

Hertz Global Holdings,
Inc.

c/o The Hertz Corporation

225 Brae Boulevard

Park Ridge, New Jersey
07656

Attention:
General Counsel

Fax: (201) 594-3122

 7
 

 

(ii)                 if
to the Executive, to the Executive at his or her most recent address as shown
on the books and records of the Company or Subsidiary employing the Executive;
and

copies of any notice or other communication
given under this Agreement shall also be given to:

if notice is given to the Company:

The Carlyle Group

1001 Pennsylvania Avenue,
NW

Suite 220 South

Washington DC 20004-2505

Attention:  Mr. Gregory S. Ledford

Fax:  (202) 347-1818

and

Clayton, Dubilier &
Rice, Inc. 

375 Park Avenue, 18th Floor

New York, New York 10152

Attention:
Mr. David Wasserman 

Fax: (212) 407-5252

and

Merrill Lynch Global
Private Equity

4 World Financial Center,
23rd Floor

New York, New York 10080

Attention:  Mr. George A. Bitar &

Mr. Robert F. End

Fax:  (212) 449-1119

and

Debevoise & Plimpton
LLP

919 Third Avenue 

New York, New York 10022

Attention:  John M. Allen, Esq.

Fax:  (212) 909-6836

if notice is given to the
Executive:

Vedder, Price, Kaufman
& Kammholz, P.C.

 8
 

 

222 N. LaSalle Street

Suite 2600

Chicago, Illinois 60601

Attention:  Robert J. Stucker, Esq.

Fax:  (312)
609-5005

All such notices and communications shall be
deemed to have been received on the date of delivery if delivered personally or
on the third business day after the mailing thereof.

(g)                                 Binding
Effect; Benefits.  This Agreement
shall be binding upon and inure to the benefit of the parties to this Agreement
and their respective successors and assigns. 
Nothing in this Agreement, express or implied, is intended or shall be
construed to give any person other than the parties to this Agreement or their
respective successors or assigns any legal or equitable right, remedy or claim
under or in respect of any agreement or any provision contained herein.

(h)                                 Waiver;
Amendment.

(i)    Waiver.  Any party hereto or beneficiary hereof may by
written notice to the other parties (A) extend the time for the
performance of any of the obligations or other actions of the other parties
under this Agreement, (B) waive compliance with any of the
conditions or covenants of the other parties contained in this Agreement and (C) waive
or modify performance of any of the obligations of the other parties under this
Agreement.  Except as provided in the
preceding sentence, no action taken pursuant to this Agreement, including,
without limitation, any investigation by or on behalf of any party or
beneficiary, shall be deemed to constitute a waiver by the party or beneficiary
taking such action of compliance with any representations, warranties,
covenants or agreements contained herein. 
The waiver by any party hereto or beneficiary hereof of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of
any preceding or succeeding breach and no failure by a party or beneficiary to
exercise any right or privilege hereunder shall be deemed a waiver of such
party’s or beneficiary’s rights or privileges hereunder or shall be deemed a
waiver of such party’s or beneficiary’s rights to exercise the same at any
subsequent time or times hereunder.

 9
 

 

(ii)                                                 Amendment.  This Agreement may not be amended, modified
or supplemented orally, but only by a written instrument executed by the
Executive and the Company.

(i)                                     Assignability.  Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company or the Executive without the prior written consent of
the other party.

(j)                                     Applicable
Law.  This Agreement shall be
governed by and construed in accordance with the law of the State of Delaware
regardless of the application of rules of conflict of law that would apply the
laws of any other jurisdiction.

(k)                                  Section
and Other Headings, etc.  The section
and other headings contained in this Agreement are for reference purposes only
and shall not affect the meaning or interpretation of this Agreement.

(l)                                     Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original and all of
which together shall constitute one and the same instrument.

 10
 

 

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

	
  

  	
  HERTZ GLOBAL
  HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Irwin Pollack

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Irwin M. Pollack

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice
  President,

  	
   

  
	
   

  	
   

  	
   

  	
  Executive
  Relations,

  	
   

  
	
   

  	
   

  	
   

  	
  Hertz Global Holdings,
  Inc.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE EXECUTIVE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Mark
  Firssora

  	
   

  
	
   

  	
  Mark P. Frissora

  
							

 

	
  Total Number of Shares

  for the Purchase of Which

  Options have been Granted

  	
   

  	
  Option Price

  	
   

  
	
  800,000

  	
   

  	
  $

  	
  7.68

  	
   

  
	
  400,000

  	
   

  	
  $

  	
  10.68

  	
   

  
	
  400,000

  	
   

  	
  $

  	
  15.68

  	
   

  

 

 11

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00109-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00109-of-00352.parquet"}]]