Exhibit (d)(xii)
[LETTERHEAD OF TSUMURA INTERNATIONAL INC]
#195361 v3 DRAFT/01/RWP
07/18/00 6:14pm
July 19, 2000
Aluwill Acquisition Corp.
c/o Chartwell Investments II LLC
717 Fifth Avenue
23rd Floor
New York, New York 10022
Gentlemen:
Reference is made to the Agreement and Plan of Merger dated as of July 19,
2000 (the "Merger Agreement") among Carey International, Inc., a Delaware
corporation (the "Company"), Limousine Holdings, LLC, a Delaware limited
liability company ("Parent"), Aluwill Acquisition Corp., a Delaware corporation
and a wholly-owned subsidiary of Parent ("Acquisition Company"), and Eranja
Acquisition Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of
Acquisition Company ("Acquisition Company Sub"). Capitalized terms used herein
but not otherwise defined herein shall have the meanings set forth in the Merger
Agreement.
The undersigned (the "Optionee"), being a holder of certain stock options
to purchase Shares (the "Options") of the Company pursuant to the one or more of
the Company's 1987 Stock Option Plan, 1992 Stock Option Plan, 1997 Equity
Incentive Plan, and 1998 Non Qualified Stock Option Plan (collectively, the
"Plans"), acknowledges that:
(a) pursuant to Section 3.4(b) of the Merger Agreement, upon the
Effective Time, each Option that has not been previously exercised shall be
cancelled and, in exchange therefor, the Optionee will receive an amount in cash
in respect of each Option equal to the excess, if any, of the Offer Price
(currently $18.25) over the per Share exercise price thereof (such payment to be
net of applicable withholding taxes); and
(b) pursuant to Section 3.1(a) of the Merger Agreement, if an Option
is validly exercised in accordance with the Plans, and the Shares received upon
such exercise are validly tendered in accordance with the Merger Agreement or
converted upon consummation of the Merger, each such Share will be converted
into the right to receive, in cash, the Offer Price (currently $18.25).
In connection with the foregoing, and in order to facilitate the
consummation of the transactions contemplated in the Merger Agreement, the
Optionee agrees to exercise the Options (including incentive stock options) in
accordance with the Plans immediately prior to the Merger. The Optionee will be
permitted to exercise the Options with the use of notes as set forth in and in
accordance with the terms of the Option Exercise/Cancellation Agreement,
substantially in the form attached hereto, which the undersigned agrees to
execute upon request of the Company. If requested by Acquisition Company in
order to accomplish the Short Form Merger, the Optionee agrees to sell the
Shares acquired upon exercise of the Options to Acquisition Company (or its
designee) at the Offer Price. The Optionee also agrees to vote all Shares owned
by Optionee in favor of the Merger.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware, regardless of the laws that might otherwise
govern under applicable principles of conflicts of laws thereof. This Agreement
may not be amended, modified or supplemented without the written consent of the
Optionee and Acquisition Company. This Agreement shall become effective upon
such time, if any, as the Merger Agreement shall be executed and delivered by
the parties thereto and shall terminate upon the termination of the Merger
Agreement.
Very truly yours,
/s/ Don R. Dailey
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Name: Don R. Dailey
ACKNOWLEDGED AND AGREED TO:
ALUWILL ACQUISITION CORP.
By: /s/ Todd Berman
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Name: Todd Berman
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Title: President
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Dated: 7/19/00
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2
RETIREMENT/CONSULTING AGREEMENT TERMS
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Provision Agreement
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Executive Don R. Dailey
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Effective Date Closing of Merger.
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Term On the Effective Date, Executive shall retire from the
Company as its President and as a director of the Board
and immediately thereafter, shall serve as a consultant
through the earlier of (if the third anniversary
thereof, (ii) Executive's termination for Cause or
(iii) Executive death.
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Position and Duties Consultant. During the Term, Executive shall provide
such consulting services as may reasonably be requested
from time to time by the Company.
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Place of Company's principal executive of fees in Washington,
Performance D.C.
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Consulting Fee During the Term, Executive shall be paid a consulting
fee of $200,000 for year one, $150,000 for year two and
$100,000 for year three (or a pro-rata amount thereof
in the event of an earlier termination of the
consultancy). During the Term, Executive shall receive
reimbursement for all travel and related expenses in
the performance of his duties.
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Benefits and During the Term, Executive shall be provided with
Perquisites health and life insurance benefits on an enhanced basis
from those that he is currently receiving; provided
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that, the Company may satisfy part of this obligation
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with respect to health insurance by paying Executive's
COBRA continuation coverage premiums.
In addition, during the Term, the Executive will be
entitled to receive the same automobile allowance,
including insurance, and use of the Company's car
service to the same extent as such were provided prior
to the Effective Date.
Executive shall not be permitted to participate in any
Company employee benefit plans unless the express terms
of which provide eligibility for consultants and
Executive meets such eligibility criteria.
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Non-compete In consideration of a payment of $50,000, during the
Covenant Term and one (1) year thereafter (the "Restricted
Period") Executive may not directly or indirectly
compete with the Company without the Company's prior
written consent.
Confidentiality During the Term and following his termination of
Covenant service, Executive shall not disclose any confidential
information or trade secrets without the Company's
written consent and he shall return of all Company
property upon termination of service.
Nonsolicitation During the Restricted Period will not attempt to
solicit any employee or customer or client of the
Company.
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Entire Agreement Upon execution of a definitive consulting agreement,
all prior agreements and understandings shall be
superceded including, without limitation, the
Employment Agreement, by and between CI and Executive,
dated as of May 12, 2000 a copy of which in its current
form has been provided to counsel for Chartwell (the
"Employment Agreement"); provided, that, Executive
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shall still be
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entitled to the payment under Section 6 of the
Employment Agreement in accordance with the terms and
conditions thereof.
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Governing Law Delaware
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IN WITNESS WHEREOF, the undersigned agree as of the 19/th/
day of July, 2000, to negotiate in good faith to enter into a definitive
retirement consulting agreement with terms and conditions which are consistent
with the terms and conditions set forth above by the Effective Date.
COMPANY
By: /s/ Don R. Dailey
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Don R. Dailey