Aberdeen-based bus and rail giant FirstGroup plc has announced the details of departing CEO Tim O’Toole’s “agreed termination arrangements” and the temporary remuneration increases for interim executive chairman Wolfhart Hauser and interim chief operating officer Matthew Gregory.

FirstGroup — which recently rejected a takeover approach from US private equity firm Apollo Global Management — said last week that under-pressure CEO O’Toole is stepping down with immediate effect.

FirstGroup said it is now “examining all appropriate means to mobilise the considerable value inherent in the group.”

Hauser will become executive chairman until a successor CEO is appointed and Gregory becomes interim chief operating officer while continuing his responsibilities as chief financial officer.

“In order to assist with a period of transition, Tim has agreed to be placed on garden leave until his employment with the company ends on 30 September 2018,” said FirstGroup.

“He will continue to receive his current salary, benefits and pension until 30 September 2018.

“A maximum payment of £699,167 in lieu of Tim’s salary, pension, car allowance and medical insurance for the unexpired period of his notice will then be made in eight equal monthly instalments beginning with the company’s October payroll.

“The instalments will be subject to mitigation.

“The company will reimburse Tim, up to a maximum of £9,000 per year, for expenses relating to taxation advice for years 2017/18 and 2018/19.

“He will also receive a capped contribution towards reasonable legal fees incurred in connection with his departure …

“Tim’s awards under the FirstGroup Long-Term Incentive Plan will lapse on the termination of his employment with the company. No further Long-Term Incentive Plan awards will be made.

“The remuneration committee having considered the matter carefully has determined that Tim’s deferred bonuses under the FirstGroup plc executive annual bonus plan, which were awarded in 2016 and 2017 and reflect past performance, will vest on their normal vesting dates.

“The vesting of the 2017 award in 2020 will remain conditional upon a determination of the committee following the conclusion of appropriate investigations into the 2016 Croydon tram incident.

“If it is determined that any shares should vest, a full explanation will be provided in the directors’ remuneration report.

“Tim will not receive a bonus in respect of 2018 and will not be eligible for participation in any 2019 bonus scheme …

“In recognition of Wolfhart agreeing to act as executive chairman pending the arrival of a new chief executive, he will receive additional remuneration of £300,000 on a per annum basis during this period.

“This brings his total fees on a per annum basis to £595,000 for the interim period.

“Wolfhart will use the majority of the additional fees he receives each month to purchase shares in the company. He will not participate in any executive incentive arrangements or receive any executive benefits …

“As Matthew will be taking on the additional role of interim chief operating officer, with the operating divisions reporting to him, his salary during this period will be increased from £437,000 to £500,000.

“His bonus under the Executive Annual Bonus Plan for 2018/19 will be based on his average salary during the year and  the payment of his monthly personal pension allowance will be based on his actual salary for that month.

“However, the current intention is that his Long-Term Incentive Plan award for 2018/19 will remain based on his salary of £437,000.”