EXHIBIT 10.36
Raymond C. Avansino, Jr.
161 West Liberty Street
Reno, Nevada 89501
October 10, 1996
Mr. Stephen F. Bollenbach
President and Chief Executive Officer
Hilton Hotels Corporation
9336 Civil Center Drive
Beverly Hills, California 90210
Dear Mr. Bollenbach:
This letter sets forth and confirms the following understandings and
agreements between myself and the Hilton Entities (defined below) respecting
the offer of termination of my contractual and business relationships with
the Hilton Entities and my offer to resign as a consultant and director of
the Hilton Entities:
1. For purposes of this letter agreement, the term (a) Hilton Entities
means Hilton Hotel Corporation and all its subsidiary corporations and its
successors and assigns: (b) Hilton Parties means Hilton Entities and their
respective officers, directors, employers, and shareholders, successors and
assigns.
2. I hereby voluntarily offer to resign any and all offices and
positions as a director which I may hold with any of the Hilton Entities, and
voluntarily offer to terminate all consulting relationships which I may have
with any of the Hilton Entities. If accepted, these resignations will be
effective as of that date.
3. Effective immediately upon your acceptance of this Letter, (a) I
will be entitled to receive, without abatement, reduction, set-off or
defense, the payments, options and other compensation listed and described on
Exhibit A hereto as and when specified therein, (b) I will be deemed and
treated as having become fully vested in the stock options specified on
Exhibit A, and all actions necessary to fully vest those options will be
deemed to have occurred. Further, you will cause the appropriate Hilton
Entities to amend the applicable stock plans and to grant me the right to
exercise all options heretofore awarded on or before April 28, 1998. In the
event that the stock plan has not been amended by December 15, 1996, then on
or before December 31, 1996 the appropriate Hilton Entities shall pay me
$3,043,912 as full payment and compensation for the options which I own and
which have not vested as of this date, without regard to options which have
already vested which I continue to hold, absolutely and
unconditionally and without being subject to any abatement, reduction,
set-off, defense or counterclaim. All payments now or hereafter owed to me by
any of the Hilton Entities are absolute and unconditional and shall be due
and payable without being subject to any abatement, reduction, set-off,
defense, or counterclaim.
4. Upon your acceptance, I will be entitled to all rights of
indemnification currently provided to any officer or director of any of the
Hilton Entities under any of the Hilton Entities' respective Articles of
Incorporation, By-Laws or Resolutions (without amendment or change).
5. Neither party will make any public statement or announcement to
anyone concerning the resignations or the termination of my relationships and
associations with the Hilton Entities except to state that I have voluntarily
offered to resign.
I hereafter will not publicly disparage or denigrate the Hilton Entities
or any of their officers or directors, and the Hilton Parties hereafter will
not publicly disparage or denigrate me, except that this does not prohibit
anyone from truthfully testifying in any proceeding.
6. I waive any and all rights to request a service letter and agree not
to request any such letter.
7. I hereby release, relinquish, and give up (and agree not to file any
suit with respect to) any and all claims, suits, and causes of action which I
may have or hold against any of the Hilton Parties in any way arising out of,
relating to, or resulting from (a) my consulting relationships, or my
services as a director for, any of the Hilton Entities or the termination
thereof, (b) any fact or conduct occurring prior to this date, (c) any
employment or business custom, practice, or policy of any of the Hilton
Entities, (d) any agreement between me and any of the Hilton Entities,
(e) any conduct or decision of any of the Hilton Parties which in any way
affected me. However, this does not constitute a release of any claim for
breach of any term of this Agreement, or my rights, if any, to any benefit
due me under any stock option or other compensation or benefit plan, or any
claims arising after the date this Agreement is executed.
8. The Hilton Parties hereby release, relinquish and give up (and agree
not to file any suit with respect to) any and all claims, suits, actions and
causes of action which any of them may have or hold against me in any way
arising out of, resulting from or existing by reason of (a) my consulting
relationships, or my services as a director for, any of the Hilton Entities
or the termination thereof, (b) any fact or conduct occurring prior to this
date, (c) any services or advice I provided to or on behalf of any of the
Hilton Parties, (d) any agreement between me and any of the Hilton Entities,
(e) any conduct or decision by me which in any way
affected any of the Hilton Parties. This, however, does not constitute a
release of any claim for a breach of this Agreement.
9. The foregoing payments and agreements are made without any admission
as to fault, liability, wrongdoing or the validity of any other party's
position by me or any of the Hilton Parties, and we each expressly deny any
and all fault, liability and wrongdoing.
10. This Agreement contains the entire agreement between the parties
concerning the subject matter hereof and supersedes all prior oral and
written communications and agreements between the parties concerning such
subject matter. The Hilton Parties shall pay upon request the costs and
expenses (including attorney's fees) incurred by me in connection with the
negotiation, preparation and execution of this Agreement, and related
services. Neither this Agreement, nor any of its terms, may be waived, added
to, changed or altered except in a writing signed by me and you.
11. I acknowledge that I have carefully read this Agreement, understand
all its terms, and have signed it voluntarily with full knowledge of its
significance after adequate opportunity for consideration and consultation
with my attorneys and/or advisors and after having been advised to consult an
attorney before signing this Agreement. I represent that no payments or
considerations have been promised to me for executing and delivering this
Agreement other than the payments, agreements, and benefits described herein,
which payments, benefits and agreements constitute adequate and sufficient
consideration for the claims herein released and my other agreements outlined
in this agreement.
This Agreement shall be governed by and construed and interpreted
according to the laws of the State of Delaware except to the extent the laws
of the United States apply.
12. In any action to enforce or recover for a breach of this Agreement,
the party who establishes by final judgment either a breach of or enforces
this Agreement shall be entitled to recover the costs and reasonable
attorneys' fees incurred to so enforce the Agreement or establish such breach
in addition to and not in lieu of any other rights and remedies to which such
party may be entitled.
Please signify your confirmation and agreement to the foregoing by
signing below where indicated.
THIS AGREEMENT CONTAINS A RELEASE OF ALL CLAIMS: READ IT CAREFULLY.
/s/ Raymond C. Avansino, Jr., attorney-in-fact
______________________________________________
Raymond C. Avansino, Jr.
Accepted, confirmed and
agreed to as of the date
of this letter
HILTON HOTELS CORPORATION
By /s/ Stephen F. Bollenbach
________________________________
Stephen F. Bollenbach
On behalf of the Hilton Entities
EXHIBIT A
RAYMOND C. AVANSINO, JR. ID: ###-##-####
1018 La Rue Avenue
RENO, NV 83509
I. STOCK OPTIONS
- - --------------------------------------------------------------------------------
OPTION DETAIL
- - --------------------------------------------------------------------------------
Option Number L-3915 Option Type NQ
Option Date 3/11/93 Shares Granted 200,000
Plan 90 Option Price $11.8905
- - --------------------------------------------------------------------------------
VESTING SCHEDULE EXERCISABLE
- - ---------------------------------- --------------------------------------------
Granted Full Vest Expires Exercisable Total Price Potential Net Gain
------- --------- ------- ----------- ------------- ------------------
Period 1 50,000 3/11/94 3/11/03 50,000 $594,531.25 $0.00
Period 2 50,000 3/11/95 3/11/03 50,000 $594,531.25 $0.00
Period 3 50,000 3/11/96 3/11/03 50,000 $594,531.25 $0.00
Period 4 50,000 3/11/97 3/11/03 0 $0.00 $0.00
------- ----------- ------------- ------------------
200,000 150,000 $1,783,593.75 $0.00
OPTION DETAIL
- - --------------------------------------------------------------------------------
Option Number L-3917 Option Type NQ
Option Date 1/20/94 Shares Granted 360,000
Plan 90 Option Price $16.2031
- - --------------------------------------------------------------------------------
VESTING SCHEDULE EXERCISABLE
- - ---------------------------------- --------------------------------------------
Granted Full Vest Expires Exercisable Total Price Potential Net Gain
------- --------- ------- ----------- ------------- ------------------
Period 1 90,000 1/20/95 1/20/04 90,000 $1,458,281.25 $0.00
Period 2 90,000 1/20/96 1/20/04 90,000 $1,458,281.25 $0.00
Period 3 90,000 1/20/97 1/20/04 0 $0.00 $0.00
Period 4 90,000 1/20/98 1/20/04 0 $0.00 $0.00
------- ----------- ------------- ------------------
360,000 180,000 $2,916,562.50 $0.00
- - ---------------------------------- --------------------------------------------
EXERCISES CANCELLATIONS
- - ---------------------------------- --------------------------------------------
Date Type Shares Value Date Reason Shares
- - ---- ---- ------ ----- ---- ------ ------
II. AUTOMOBILE
1993 Mercedes 500 SL (currently using)
III. OFFICE EQUIPMENT
Office equipment currently in Avansino's possession