The tax-free windfall—the result of bargaining on the day the couple's divorce trial was to begin—ends the soap opera that began two years ago, when Giuliani, 58, told reporters he and his wife of 16 years were separating. That came as news to Hanover, 52, who blamed the breakup on her spouse's indiscretion. A week earlier he made public his relationship with Judith Nathan, 47. Hanover, an actress and TV host, filed for divorce on grounds of "cruel and inhuman treatment."
The settlement, which Giuliani says he accepted to "spare anyone any further embarrassment," also gives Hanover the couple's apartment, residential custody of Andrew, 16, and Caroline, 12, and unspecified child support—"a spectacular win," said her attorney, Helene Brezinsky. Giuliani "was always prepared to be generous," says his lawyer, Raoul Felder. He can afford to be: After 9/11, "America's Mayor" will earn more than $8 million in speaking engagements alone this year. "I think he is just happy it's over with," says pal Howard Koeppel. "He is not looking back."
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