Hertz 2014 Annual Report Download - page 242

Table of Contents
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 
respective executive for 2014.
Cash Bonus for John P. Tague
In connection with the hiring of John P. Tague as CEO, Hertz Holdings entered into a term sheet and later an employment agreement with Mr.
Tague setting forth his annual bonus for 2014. Pursuant to his term sheet and employment agreement, Mr. Tague received a guaranteed bonus of
$108,750. Mr. Tague’s bonus was calculated as follows:



 


 


 

  
Mr. Tague 150%

1,450,000

60

1/12

108,750
Mr. Tague did not participate in the Senior Executive Bonus Plan in 2014, but will be a participant in 2015.
Cash Payments to Brian P. MacDonald
In connection with the hiring of Mr. MacDonald in June 2014, Hertz Holdings entered into an employment agreement with Mr. MacDonald. The
terms of the employment agreement provided that Mr. MacDonald would be entitled, at minimum, to his target award (target was 130% of base
salary) as pro-rated for his June 2, 2014 start date. In light of the performance of the Company under the Senior Executive Bonus Plan and the
EICP, Mr. MacDonald was awarded a total of $834,493, the minimum amount as set forth under his employment agreement.
The Board elected to pay Mr. MacDonald an additional cash bonus, retroactive to the date Mr. MacDonald was appointed as interim CEO of our
Company, equal to a proportionate amount of a $500,000 annual bonus, in recognition of his increased responsibilities as interim CEO, which
amount was in addition to any amounts he would be entitled to receive under the Senior Executive Bonus Plan or his employment agreement. The
amount of that bonus paid to Mr. MacDonald for his service as interim CEO during 2014 was $125,000.
Cash Bonus for Thomas C. Kennedy
In March 2014, the Compensation Committee, upon recommendation of our former CEO, Mr. Frissora, elected to pay Mr. Kennedy an additional
cash bonus of $251,835 in recognition of his superior performance. The bonus was a one-time bonus and did not recur during the first quarter of
2015. Mr. Kennedy was also paid a sign-on bonus of $75,000 in 2014 in connection with his hire in December of 2013.
Special Award Agreement with Robert J. Stuart
As discussed under “Determining What We Pay - Compensation Philosophy and the Role of the Compensation Committee” above, our
Compensation Committee wants to ensure we retain key individuals. Accordingly, on July 1, 2014, we entered into an agreement with Mr. Stuart to
retain him and reward him for his valuable services to our Company. Mr. Stuart was eligible for, and was paid, $500,000 if he remained an
employee of our Company on July 1, 2015. Mr. Stuart is eligible for an additional payment of $500,000 if he remains an employee of our Company
on July 1, 2016. In the event Mr. Stuart is terminated without cause before July 1, 2016, Mr. Stuart will be eligible to be paid $500,000. In the
event of Mr. Stuart’s death or disability before July 1, 2016, Mr. Stuart will be eligible to receive a pro-rated amount of his award based on the
number of months he served as an employee before his death or disability. If Mr. Stuart’s employment is terminated for any other reason before
July 1, 2016, he will be ineligible for any bonuses remaining under the agreement.
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During late 2014 and early 2015 the Compensation Committee did an intensive review of the EICP and decided to simplify its structure to focus
participants on one performance metric that is clear, understandable and drives overall business results. While a number of metrics were
considered, the Compensation Committee chose the earnings metric of API to be used at both the corporate and business unit level. API is
familiar to participants, it is easily understandable and it aligns incentives for all participants.
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Source: HERTZ GLOBAL HOLDINGS INC, 10-K, July 16, 2015 Powered by Morningstar® Document Research℠
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