SEPARATION AGREEMENT

Exhibit 10.1

EXECUTION COPY

SEPARATION AGREEMENT

THIS SEPARATION AGREEMENT (“Agreement”) is by and between Luke Hayden (“Hayden”) and PHH Corporation (the “Company”).

WHEREAS, Hayden’s employment with the Company ended effective March 12, 2012; and

WHEREAS, the parties desire to provide for certain payments and benefits as consideration for Hayden’s agreement to certain restrictive covenants and his execution of a general release of claims.

NOW THEREFORE, intending to be legally bound hereby, the Company and Hayden agree as follows:

Last Day of Employment

Hayden’s employment with the Company and all of its subsidiaries and affiliates terminated on March 12, 2012 (the “Termination Date”).

Consideration

In consideration of Hayden’s execution of and failure to revoke the Release Agreement contained in Exhibit A to this Agreement (the “Release”), and his continued compliance with the terms and conditions of this Agreement, the Company agrees to pay or provide the following payments and benefits:

(a)                                 Pay to Hayden severance in an amount equal to his annual base salary of $468,000 for the 12-month period beginning on the Termination Date.  The severance will be payable bi-weekly in accordance with the Company’s normal payroll practices commencing within 21 days after the date on which the Release becomes irrevocable, however, the by-weekly payments scheduled to be paid after the Termination Date and before the first such bi-weekly payment is made shall be made with the first such bi-weekly payment.

(b)                                 Pay to Hayden the annual bonus he earned for 2011 under the PHH Corporation Management Incentive Plan, as may be amended from time to time, in the amount of $200,000, which amount shall be paid within 21 days after the date on which the Release becomes irrevocable.  No bonus will be paid for 2012.

(c)                                  Reimburse Hayden’s payment of premiums for COBRA coverage, if elected by Hayden and his eligible dependents, upon loss of coverage under the Company’s group health plan due to his termination on the Termination Date, until the earlier of (i) the date that Hayden becomes eligible for coverage under another group health plan, or (ii) March 31, 2013.  The Company will impute the amount of the COBRA premium during the period of COBRA coverage as taxable income to Hayden.

1

(d)                                 Reimburse Hayden for the cost of outplacement assistance up to $15,000 for services through December 31, 2012.

None of the foregoing payments or benefits will be made or provided if this Agreement and the Release have not been signed by Hayden, and the Release has not become irrevocable, on or before July 6, 2012.  Payment and provision of the foregoing benefits are conditioned on Hayden’s continued compliance with the restrictive covenants in this Agreement.

All amounts paid and property transferred under this Agreement shall be subject to applicable withholdings for federal, state, and local taxes.

Hayden acknowledges that: (A) the payments and benefits set forth in this Agreement constitute full settlement of all his rights arising out of his employment with the Company, (B) he has no entitlement under any other severance or similar arrangement maintained by the Company, and (C) except as otherwise provided specifically in this Agreement, the Company does not and will not have any other liability or obligation to Hayden.  Hayden further acknowledges that, in the absence of his execution of this Agreement and the Release, benefits and payments specified in the “Consideration” section of the Agreement would not otherwise be due to Hayden.

No Mitigation or Off-Set

Hayden is under no obligation to seek other employment and there shall be no offset against amounts or benefits due to Hayden under this Agreement as a result of any compensation that Hayden may earn in connection with future employment.

Covenants Not to Compete

In further consideration for the benefits and payments set forth in this Agreement, Hayden agrees that, for the period beginning on the date on which he executes this Agreement and ending on the last day of the 12-month period after the Termination Date (the “Restriction Period”), Hayden shall not compete with the Company or any of its subsidiaries or affiliates (the “PHH Group”), as set forth below:

(i)                                     Hayden agrees that he will not, directly or indirectly, as an individual on Hayden’s own account, or as an independent contractor, employee, consultant, agent, partner, member, joint venturer or otherwise, provide any service or assistance, in any capacity or function, to any business that is engaged in any of the businesses of or services provided by the PHH Group, any businesses or services contemplated by the PHH Group and with respect to which the PHH Group had expended significant resources, or any other business or service otherwise competing with the businesses of the PHH Group, in each case as in effect or determined as of his Termination Date or any time during which Hayden provided services to the PHH Group, including, but not limited to businesses in the fleet management, mortgage origination and/or mortgage servicing industries, or any of the following: Mike Albert Leasing, Inc.; Allstate Leasing, Inc.; ARI (Automotive Rentals, Inc.); Donlen Corporation; Enterprises Leasing Company; GE Commercial Finance Fleet Services; Emkay Vehicle Leasing; Lease Plan

2

U.S.A.; Wheels, Incorporated; American Leasing; BBL; MotoLease; Merchants Leasing; Sutton Leasing; ULTEA; SunTrust; Wells Fargo; The CEI Group; Fleet Response; CCM; Union Leasing; Wells Fargo Home Mortgage; Bank of America Mortgage; Chase Home Finance; CitiMortgage, Inc.; GMAC Residential Holdings; SunTrust Mortgage, Inc.; MetLife Bank; Quicken Loans, Inc.; CTX Mortgage; Branch Banking & Trust Co.; Pulte Mortgage; AmSouth Mortgage; Fifth Third Mortgage; U.S. Bank Home Mortgage; Citizens Mortgage Corporation; and any successor entity of any of the foregoing that is created by merger, consolidation or any other similar transaction.

(ii)                               Hayden acknowledges that the PHH Group’s businesses are conducted nationally and agrees that the restrictions herein shall operate throughout the United States. Nothing herein shall prohibit Hayden from being a passive owner of not more than 5% of the outstanding securities of any publicly traded company that would be a competing company as described in subsection (i) above, so long as Hayden has no active participation in the business of such company.

(iii)                            Hayden agrees that he will not, directly or indirectly, as an individual on Hayden’s own account, or as an independent contractor, employee, consultant, agent, partner, member, joint venturer or otherwise, solicit, induce or encourage, or permit any person or entity to solicit, encourage, induce or attempt to induce on Hayden’s behalf during the Restriction Period:

(1)                                 any person who was employed by the PHH Group on the Termination Date, and/or any person who was employed by the PHH Group at any time during the twelve-month period immediately preceding the Termination Date, to terminate their employment with the PHH Group, or in any way interfere with the relationship between the PHH Group and any employee thereof; or

(2)                                 any customer, client, supplier, licensee, target identified for acquisition by the PHH Group, or other person or entity that does business with the PHH Group to cease doing business with the PHH Group, or in any way interfere with the relationship between any such persons or entities and the PHH Group.

(iv)                           Hayden agrees that he will not, directly or indirectly, as an individual on Hayden’s own account, or as an independent contractor, employee, consultant, agent, partner, member, joint venturer or otherwise, during the Restriction Period, call on, solicit or service any person or entity who was a customer, client, target identified for acquisition by the PHH Group, licensor or licensee of the PHH Group at any time during the twelve-month period immediately preceding the Termination Date for any purpose which directly or indirectly competes with the business of the PHH Group.

Hayden is subject to restrictive covenants contained in other agreements which may be similar to those contained in this Section.  Hayden acknowledges the foregoing and understands that the covenants contained in this Section are in addition to, and not in substitution of, the covenants contained in such other agreements, which shall also continue to survive.

3

Hayden agrees and acknowledges that the promises and covenants not to compete set forth above each have a unique, very substantial and immeasurable value to the PHH Group, that the PHH Group is engaged in a highly competitive industry, and that Hayden is receiving significant consideration in exchange for these promises and covenants.  Hayden acknowledges that the promises and covenants set forth above are necessary for the reasonable and proper protection of the PHH Group’s legitimate business interests; and that each and every promise and covenant is reasonable with respect to activities restricted, geographic scope and length of time.

Confidential Information

Hayden acknowledges that as part of his employment with the PHH Group, he had access to information that was not generally disclosed or made available to the public. Hayden recognizes that in order to guard the legitimate interests of the PHH Group, it is necessary for it to protect all confidential information. Hayden agrees to keep secret all non-public, confidential and/or proprietary information, matters and materials of the PHH Group, and personal confidential or otherwise proprietary information regarding the PHH Group’s employees, executives, directors or consultants affiliated with the PHH Group, including, but not limited to, documents, materials or information regarding, concerning or related to the PHH Group’s research and development, its business relationships, corporate structure, financial information, financial dealings, fees, charges, personnel, methods, trade secrets, systems, procedures, manuals, confidential reports, clients or potential clients, financial information, business and strategic plans, proprietary information regarding its financial or other business arrangements with Hayden, sales representatives, editors and other professionals with which it works, software programs and codes, access codes, and other similar materials or information, as well as all other information relating to the business of the PHH Group which is not generally known to the public or within the fleet management and/or mortgage industries or any other industry or trade in which the PHH Group competes (collectively, “Confidential Information”), to which Hayden has had or may have access and shall not use or disclose such Confidential Information to any person except (i) to the extent required by applicable law, (ii) to his personal advisors, to the extent such advisors agree to be bound by this provision, or (iii) to the minimum necessary to enforce this Agreement. This obligation is understood to be in addition to any agreements Hayden may have signed with the PHH Group or any of its subsidiaries or affiliates concerning confidentiality and non-disclosure, non-competition, non-solicitation, and assignment of inventions or other intellectual property developments, which agreements will remain in full force and effect, and in addition to any protections afforded the PHH Group under the New Jersey Trade Secrets Act.

4

Non-Disparagement

Hayden will not disparage or defame, through verbal or written statements or otherwise, the PHH Group or any of its members, directors, officers, agents or employees or otherwise take any action which could reasonably be expected to adversely affect the reputation, business practices, good will, products and services of the PHH Group or the personal or professional reputation of any of the PHH Group’s members, directors, officers, agents or employees.

The Company, in its official capacity, will direct its officers and directors not to disparage or defame, through verbal or written statements or otherwise, Hayden or otherwise take any action which could reasonably be expected to adversely affect Hayden’s reputation.

Neither this non-disparagement provision nor the cooperation section below shall be construed to prevent any such person from testifying truthfully under oath in a legal or regulatory proceeding or providing and truthful or accurate information in connection with any disclosure, statement or document required by law.

Acknowledgement and Enforcement

Hayden agrees and acknowledges that in the event of a breach or threatened breach by Hayden of one or more of the covenants and promises described above in “Covenants Not to Compete,” “Confidential Information,” and “Non Disparagement,” the PHH Group will suffer irreparable harm that is not compensable solely by damages.  Hayden agrees that under such circumstances, no further payments, rights or benefits provided under the “Consideration” section this Agreement will be due to Hayden, and Hayden must repay to the Company amounts described under “Consideration” paid to him in cash, within 10 days after demand by the Company, and the PHH Group shall be entitled, upon application to a court of competent jurisdiction, to obtain injunctive or other relief to enforce these promises and covenants.  The Company and any other member of the PHH Group will, in addition to the remedies provided in this Agreement, be entitled to avail itself of all such other remedies as may now or hereafter exist at law or in equity for compensation and for the specific enforcement of the covenants in this Agreement.  The remedies for breach of restrictive covenants in any equity incentive award agreements with Hayden shall also continue to apply.  Resort to any remedy provided for in this Agreement or provided for by law will not prevent the concurrent or subsequent employment of any other appropriate remedy or remedies or preclude the Company or PHH Group’s recovery of monetary damages and compensation.

Cooperation

Hayden further agrees that, subject to reimbursement of his reasonable expenses, he will cooperate fully with the Company and any of its subsidiaries and affiliates and their counsel with respect to any matter (including any pending or future litigation, investigations, or governmental proceedings) which relates to matters with which Hayden was involved during his employment with the Company. Hayden will render such cooperation in a timely manner upon reasonable notice from the Company.

5

Challenge

If Hayden violates or successfully challenges the enforceability of any provisions of this Agreement, no further payments, rights or benefits provided under the “Consideration” section this Agreement will be due to Hayden. However, Hayden may seek clarification from the Company of his rights and obligations under this Agreement, and, if a dispute remains after seeking clarification, Hayden may raise a dispute regarding his rights under this Agreement pursuant to the Arbitration provisions of this Agreement.

Arbitration

Any dispute arising under this Agreement or the Release executed in connection with this Agreement will be resolved by arbitration administered exclusively in Cherry Hill, New Jersey, by JAMS, or at such other location in New Jersey which is mutually agreeable to the parties and the selected JAMS arbitrator or arbitrators by JAMS, pursuant to its then-prevailing Employment Arbitration Rules & Procedures, before an arbitrator or arbitrators whose decision shall be final, binding and conclusive on the parties, and judgment on the award may be entered in any court having jurisdiction.  The Company shall bear any and all costs of the arbitration process, excluding any attorneys’ fees or other costs incurred by Hayden with regard to such arbitration.  Hayden and the Company further acknowledge and agree that, due to the nature of the confidential information, trade secrets, and intellectual property belonging to the PHH Group to which Hayden has been given access, and the likelihood of significant harm that the PHH Group would suffer in the event that such information was disclosed to third parties, nothing in this paragraph shall preclude the Company or any other member of the PHH Group from seeking injunctive relief to prevent Hayden from violating, or threatening to violate, the terms under the “Covenants Not to Compete,” “Confidential Information” and “Non-Disparagement” sections of this Agreement.

Miscellaneous

No Admission of Liability.  This Agreement is not to be construed as an admission of any violation of any federal, state or local statute, ordinance or regulation or of any duty owed by the Company or any other person to Hayden, or by Hayden or any other person to the Company.  There have been no such violations, and both the Company and Hayden specifically deny any such violations.

Absence of Reliance. Hayden acknowledges that in agreeing to this Agreement, he has not relied in any way upon representations or statements of the Company other than those representations or statements set forth in this Agreement.

No Reinstatement.  Hayden agrees that he will not apply for reinstatement with the Company or any other member of the PHH Group or seek in any way to be reinstated, re-employed or hired by the Company or any other member of the PHH Group in the future.

Section Headings. The section headings are solely for convenience of reference and shall not in any way affect the interpretation of this Agreement.

6

Notice. Notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by United States certified mail, return receipt requested, or by overnight courier, postage prepaid, to the Company at its corporate headquarters address, to the attention of the Secretary of the Company, or to Hayden at the home address most recently communicated by Hayden to the Company in writing.

409A Compliance.  The parties agree that the payments and benefits under “Consideration” in this Agreement will not be subject to the 6 month delay in payment described in Section 409A of the Internal Revenue Code and the Treasury Regulations thereunder (“Section 409A”) due to application of exemptions under Section 409A, including Treasury Regulation Section 1.409A-1(b)(9)(iii) (the “two times, two year rule”) and Treasury Regulation Section 1.409A-1(b)(4) (the “short-term deferral rule”).  For purposes of Section 409A, the right to a series of installment payments under this Agreement shall be treated as a right to a series of separate payments.

With respect to any reimbursement of expenses of, or any provision of in-kind benefits to, Hayden, as specified under this Agreement, that are not exempt from Section 409A, such reimbursement of expenses or provision of in-kind benefits shall be subject to the following conditions: (1) the expenses eligible for reimbursement or the amount of in-kind benefits provided in one taxable year shall not affect the expenses eligible for reimbursement or the amount of in-kind benefits provided in any other taxable year; (2) the reimbursement of an eligible expense shall be made no later than the end of the year after the year in which such expense was incurred; and (3) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit.

Successors and Assigns.  This Agreement will inure to the benefit of and be binding upon the Company and Hayden and their respective successors, executors, administrators and heirs. Hayden may not make any assignment of this Agreement or any interest herein, by operation of law or otherwise.  The Company may assign this Agreement to any successor to all or substantially all of its assets and business by means of liquidation, dissolution, merger, consolidation, transfer of assets, or otherwise.

Severability.  Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law.  However, if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability will not affect any other provision, and this Agreement will be reformed, construed and enforced as though the invalid, illegal or unenforceable provision had never been herein contained.

Entire Agreement; Amendments.  Except as otherwise expressly provided herein, this Agreement contains the entire agreement and understanding of the parties hereto relating to the subject matter hereof, and merges and supersedes all prior and contemporaneous discussions, agreements and understandings of every nature relating to the subject matter hereof.  This

7

Agreement may not be changed or modified, except by an agreement in writing signed by each of the parties hereto.

Governing Law.  This Agreement will be governed by, and enforced in accordance with, the laws of the State of New Jersey without regard to the application of the principles of conflicts of laws.

Counterparts and Facsimiles.  This Agreement may be executed, including execution by facsimile signature, in multiple counterparts, each of which will be deemed an original, and all of which together will be deemed to be one and the same instrument.

IN WITNESS WHEREOF, Hayden and the Company have executed as of the dates specified below.

8

Exhibit A

RELEASE AGREEMENT

THIS RELEASE (the “Release”) is entered into between Luke Hayden (“Hayden”) and PHH Corporation, a Maryland corporation (the “Company”), for the benefit of the Company. The entering into and non-revocation of this Release is a condition to Hayden’s right to receive the severance payments and benefits under the Separation Agreement by and between the Company and Hayden which has been executed by Hayden on June 13, 2012 (the “Separation Agreement”).

Accordingly, Hayden and the Company agree as follows.

1.                                      In consideration for the severance payments and other benefits provided to Hayden by the Separation Agreement to which Hayden is not otherwise entitled, and the sufficiency of which Hayden acknowledges, Hayden represents and agrees, as follows:

(a)                                                                                 Hayden, for himself, his heirs, administrators, representatives, executors, successors and assigns (collectively “Releasers”), hereby irrevocably and unconditionally releases, acquits and forever discharges and agrees not to sue the Company or any of its subsidiaries, divisions, affiliates and related entities and their respective current and former directors, officers, shareholders, trustees, employees, consultants, independent contractors, representatives, agents, servants, successors and assigns and all persons acting by, through or under or in concert with any of them (collectively “Releasees”), from all rights and liabilities up to and including the date of this Release arising under or relating to the employment of Hayden and from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, actions, causes of actions, suits, rights, demands, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected and any claims of wrongful discharge, breach of contract, implied contract, promissory estoppel, defamation, slander, libel, tortious conduct, employment discrimination or claims under any federal, state or local employment statute, law, order or ordinance, including but not limited to any rights or claims arising under Title VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621 et seq. (“ADEA”), the New Jersey Law Against Discrimination, N.J. Stat. Ann. § 10:5-1 et seq., and the New Jersey Equal Pay Act, N.J. Stat. Ann. § 34:11-56.1 et seq., the New Jersey Family Leave Act, N.J. Stat. Ann. § 34:11B-1 et seq., and the New Jersey Conscientious Employee Protection Act, N.J. Stat. Ann.  § 34:19-1 et seq., all as amended, or any other federal, state or municipal ordinance relating to discrimination in employment.  The recitation of any particular law or statute is for purposes of example only, and does not in any way limit the broad scope of this release.  Nothing contained herein shall restrict the parties’ rights to enforce the terms of the following: this Release, the Separation Agreement, any vested benefits under retirement plans sponsored by the Company, coverage under any officers’ and directors’ liability insurance policies, and rights of defense (or the cost thereof) or indemnification under the Company’s bylaws or charter or resolution of the Company’s Board of Directors.

(b)                                                                                 To the maximum extent permitted by law, Hayden agrees that he has not filed, nor will he ever file, a lawsuit asserting any claims which are released by this Release, or to accept any benefit from any lawsuit which might be filed by another person or government entity based in whole or in part on any event, act, or omission which is the subject of this Release.

(c)                                                                                  This Release specifically excludes Hayden’s indemnification as an officer and employee of the Company or any affiliate thereof. Nothing contained in this Release shall release Hayden from his obligations, including any obligations to abide by restrictive covenants under the Separation Agreement, that continue or are to be performed following termination of employment.

(d)                                                                                 The parties agree that this Release shall not affect the rights and responsibilities of the US Equal Employment Opportunity Commission (hereinafter “EEOC”) to enforce ADEA and other laws. In addition, the parties agree that this Release shall not be used to justify interfering with Hayden’s protected right to file a charge or participate in an investigation or proceeding conducted by the EEOC. The parties further agree that Hayden knowingly and voluntarily waives all rights or claims (that arose prior to Hayden’s execution of this Release) the Releasers may have against the Releasees, or any of them, to receive any benefit or remedial relief (including, but not limited to, reinstatement, back pay, front pay, damages, attorneys’ fees, experts’ fees) as a consequence of any investigation or proceeding conducted by the EEOC.

2.                                      Hayden acknowledges that the Company has specifically advised him of the right to seek the advice of an attorney concerning the terms and conditions of this Release. Hayden further acknowledges receipt of a copy of this Release, and has been afforded twenty-one (21) days in which to consider the terms and conditions set forth above prior to signing this Release (although he may elect not to use the full 21-day period at his option), and that changes to this Agreement, material or otherwise, do not extend the 21-day period.  By executing this Release, Hayden affirmatively acknowledges sufficient and reasonable time to review this Release and to consult with an attorney concerning Hayden’s legal rights prior to the final execution of this Release. Hayden has carefully read this Release and fully understands its terms. Hayden understands that he may revoke this Release within seven (7) days after signing this Release. Revocation of this Release must be made in writing and must be received by the General Counsel of PHH Corporation, 3000 Leadenhall Road, Mail Stop LGL, Mt. Laurel, NJ 08054 within the time period set forth above.

3.                                      This Release will be governed by and construed in accordance with the laws of the State of New Jersey, without giving effect to any choice of law or conflicting provision or rule (whether of the State of New Jersey or any other jurisdiction) that would cause the laws of any jurisdiction other than the State of New Jersey to be applied. In furtherance of the foregoing, the internal law of the State of New Jersey will control the interpretation and construction of this agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. The provisions of this Release are severable, and if any part or portion of it is found to be unenforceable, the other paragraphs shall remain fully valid and enforceable. This Release shall become effective and enforceable on the eighth day following its execution by Hayden, provided he does not exercise his right of

2

revocation as described above. If Hayden fails to sign this Release or revokes his signature, this Release will be without force or effect, and Hayden shall not be entitled to the severance payments or benefits under the Separation Agreement.

I, LUKE HAYDEN, HAVING READ THE FOREGOING RELEASE, UNDERSTANDING ITS CONTENT AND HAVING HAD AN OPPORTUNITY TO CONSULT WITH COUNSEL OF MY CHOICE, DO HEREBY KNOWINGLY AND VOLUNTARILY SIGN THIS AGREEMENT, THEREBY WAIVING AND RELEASING MY CLAIMS, ON JUNE 13, 2012.

3