AGREEMENT
between
ASF XXXXXX INDUSTRIES GMBH, PUCHHEIM
- hereinafter referred to as "ASF" -
a n d
XXXXX XXXXXXXXX
- hereinafter referred to as
"Xx. Xxxxxxxxx" -
Xx. Xxxxxxxxx has acted as managing director for ASF, based on a service
agreement with ASF, up to now. Against the background of restructuring measures,
ASF and Xx. Xxxxxxxxx agree that this service relationship terminated.
Termination took effect on December 31, 2002.
ASF notes that in the context of the aforementioned restructuring measures now
TIWR Holding GmbH & Co. KG and Xx. Xxxxxxxxx enter into the following managing
director's service agreement. ASF gives its explicit consent to the transfer of
the pension commitment from ASF to TIWR Holding GmbH & Co. KG as stipulated in
no. 6 of the following service agreement.
................................................
(ASF XXXXXX Industries GmbH,
represented by its sole shareholder, ASF XXXXXX
Industries Holding Deutschland GmbH,
which is represented by its managing director
Xxxxx Xxxxxxxxx who is authorized to individually
represent the company)
................................................
(Xxxxx Xxxxxxxxx)
SERVICE AGREEMENT
between
TIWR HOLDING GMBH & CO. KG
- hereinafter referred to as "Company" -
a n d
XXXXX XXXXXXXXX
- hereinafter referred to as "Managing
Director" -
The following provisions shall apply to the service relationship with effect as
of January 1, 2003; all prior written and oral agreements are hereby entirely
replaced:
1. SCOPE OF DUTIES
1.1 Full individual responsibility for the management of the Company and of
TIWR Verwaltungs GmbH - hereinafter referred to as "GmbH" -, which is
as general partner appointed to the management of the Company and the
managing director of which Xx. Xxxxxxxxx is appointed to, shall be
incumbent upon the Managing Director jointly with the other managing
directors.
The Managing Director shall conduct the business of the Company and the
GmbH diligently and conscientiously pursuant to applicable laws, the
provisions of the Companies' Articles of Association, any rules of
procedure applicable to Management, and instructions given by the
Shareholders.
1.2 The representation authority of the Managing Director shall be
determined by the provisions of the shareholder agreements and the
resolution on his appointment as managing director; said authority can
be curtailed at any time. The Managing Director may only make use of
this representation authority in the framework of his management
authority.
1.3 The Shareholder Meeting reserves the right to determine, from time to
time, the allocation of business among the various managing directors.
1.4 The Managing Director agrees to act also for enterprises connected with
the Company or the GmbH (subsidiary companies). The provisions of this
Service Agreement therefore apply analogously to activity within the
subsidiary companies and entirely replace any possibly existing
contracts.
2. TERM
2.1 This Service Contract shall commence on
January 1, 2003.
2.2 This Service Contract can be terminated under observance of a notice
period of 12 months taking effect at the end of a calendar year.
Termination can take effect on December 31, 2005 at the earliest.
2.3 Any notice of termination shall be given
in writing.
2.4 In the event of a termination of this Service Agreement by either
party, the Company may release the Managing Director from his services
until the end of the termination period and subject to continuing
payments attributable to him under this Service Contract. The period of
release shall be set off against any possible vacation entitlement.
2.5 This Service Contract shall terminate without requiring any further
notice at the end of the month during which the Managing Director
attains the age of 65.
3. TRANSACTIONS SUBJECT TO CONSENT
Any business transactions beyond the normal scope of business shall be
subject to the prior consent of a person to be appointed by the company
XXXXXX Industries Inc. The contracting parties agree that XXXXXX
Industries Inc. has appointed Mr. Xxxxxxx Xxxxx, President of XXXXXX
Industries Inc., for this purpose until further notice. The requirement
for the consent shall include but not be limited to:
o purchase, disposal and mortgaging of real property and rights
equivalent to real property;
o taking up new, abandoning existing, Company businesses;
o formation and discontinuance of branch offices and branch
operations;
o purchase and disposal of operations and permanent holdings;
o conclusion, amendment and revocation of contracts for the lease
of running concerns, profit-and-loss assumption agreements as
well as other corporate agreements;
o taking out and repayment of loans;
o agreeing upon credit lines for current account and acceptance
credits, as well as amending any such agreement;
o granting loans;
o providing collateral for any third party, including but not
limited to standing surety and providing warranties;
o conclusion, amendment and termination of license agreements
regarding industrial property rights and know how;
o realization of investments (including leasing) if the purchase or
production costs exceed EURO 150,000 in a business year or EURO
100,000 in a single case;
o conclusion, amendment and termination of rent, lease and license
agreements as well as any other agreement with a term or notice
period of more than five years or an annual rent or lease of more
than EURO 100,000;
o granting and withdrawing powers of commercial representation;
o conclusion, amendment and termination of contracts for the
service - including pension commitments - of other managing
directors of the Company and of the GmbH;
o pension agreements, profit sharing agreements and any other
allowances granted by the Company to the staff except for the
usual Christmas allowance and holiday allowance;
o execution of voting rights in holding companies if the legal
transaction to be resolved is a legal transaction or act which
requires consent within the meaning of this contract or if the
shareholders' meeting would be responsible;
o agreements with shareholders or persons associated with them.
4. REMUNERATION
4.1 The Managing Director shall be entitled to an annual base salary of
EURO 252,000.00 gross, payable in 12 equal monthly installments at the
end of each month, statutory deductions being retained.
The Company shall bear 50% of the social security contributions
(pension, health, unemployment, health care) up to the maximum amounts
under the German social security system.
4.2 In addition, the Managing Director shall be paid a guaranteed annual
bonus in the gross amount of EURO 298,000.00, payable by February 1 of
the following year. If the term of the Service Contract begins or
expires at any time other than the beginning or the end of a calendar
year, then the Managing Director shall only be entitled to a pro rata
bonus for the remainder of such calendar year.
4.3 During the term of this contract, the Managing Director will
participate in the XXXXXX Industries Stock Awards Program pursuant to
each valid provision of XXXXXX Industries, which is applicable and
determined by the Compensation Committee of the Board of Directors of
XXXXXX Industries Inc. for the respective calendar year. The
participation is subject to the respective approval of the Compensation
Committee.
4.4 During the term of this contract, the Managing Director will
participate in the XXXXXX Industries Stock Options Program pursuant to
each valid provision of XXXXXX Industries, which is applicable and
determined by the Compensation Committee of the Board of Directors of
XXXXXX Industries Inc. for the respective calendar year. The
participation is subject to the respective approval of the Compensation
Committee.
4.5 Travel and other expenses shall be reimbursed to the Managing Director
in accordance with the Company's expense policy and within the scope of
the amounts permissible under the tax regulations.
4.6 The Managing Director shall be entitled to an upper class company car
(e.g. BMW 7 series), which may be used also for private purposes. The
Company shall bear all current expenses pertaining to the car, except
fuel expenses on vacation trips. Any income tax payable for the
monetary value inherent in the benefit of said private use shall be
borne by the Managing Director. The Managing Director must return the
company car upon legal expiration of the Service Contract at the
latest.
4.7 The aforementioned remuneration shall also cover any activity for
enterprises connected with the Company or the GmbH (see no. 1.4 of this
Contract). The Managing Director herewith waives explicitly any
possibly existing claims for remuneration.
5. INABILITY TO WORK, DEATH BENEFITS
5.1 In the event of any temporary inability to work due to illness the
Managing Director's base salary pursuant to no. 4.1 sentence 1 of this
Agreement shall continue to be paid for a twelve month period, but in
no event longer than up to the termination of this Service Agreement,
the amount corresponding to the sickness benefits paid by the health
insurance of the Managing Director being deducted.
5.2 If the Managing Director dies during the term of this Agreement, his
heirs as joint and several creditors shall receive the base salary
pursuant to no. 4.1 sentence 1 of this contract for the month, in which
the Managing Director died, and for the following three months.
Furthermore, the heirs shall receive as joint and several creditors the
bonus payment pursuant to no. 4.2 of this Contract for the respective
year, calculated on a pro rata basis until the end of the month, in
which the Managing Director died. This payment shall be due as
stipulated in no. 4.2. If more than one heir exists, the Company is
released from its obligations pursuant to sentence 1 and 2, if it pays
to a family member, which lived together with the Managing Director in
common household at the time of death or to one of the Managing
Director's heirs.
6. PENSION COMMITMENT
The pension commitment, which was granted based on the service
relationship between ASF XXXXXX Industries GmbH, Puchheim and the
Managing Director, shall herewith be transferred in the current version
to the Company. The transfer shall take effect on January 1, 2003. The
parties agree, however, that the widow's pension which was agreed for
the benefit of the Managing Director's wife, Xxxxxxx Xxxxxxxxx, shall
be cancelled upon the widow's demise and in case of her remarriage. Due
to the transfer, the Company entirely replaces the previous contracting
party to this pension commitment.
7. VACATION
7.1 The Managing Director shall be entitled
to 30 holidays.
7.2 When scheduling any such vacations, the Managing Director shall take
due account of Company business, such business taking precedence in any
specific case.
7.3 In the event the Managing Director may not be in a position to totally
or partially go on vacation due to the requirements of the Company the
Parties will negotiate in good faith about a transfer of the vacation
into the next calendar year.
8. INSURANCE
8.1 The Company insures the Managing Director appropriately at its own
expense against the risk of accidents as well as against death,
invalidity, personal injury and material damage as well as against loss
of earnings (24 hours protection).
8.2 The claims resulting out of the insurance are immediately due to the
Managing Director or to the person stated in the insurance policy after
death of the Managing Director, respectively.
9. SECRECY
The Managing Director undertakes at all times during the term of this
Service Agreement and thereafter to hold in strictest confidence any
trade secrets of the Company or its associated companies.
10. NON-COMPETITION COVENANT
For the duration of this Agreement, the Managing Director shall refrain
from acting - in a self-employed, employed, or any other capacity
whatsoever - for any other firm or company irrespective of its legal
form, or to form or purchase any such firm or company, or any interest
therein, in direct or indirect competition with the Company.
11. SIDE-LINE ACTIVITIES
11.1 The Managing Director shall dedicate his entire working capacity and
all his technical know-how and experience at the Company's and the
GmbH's exclusive disposal. The provision under no. 1.4 shall remain
unaffected.
11.2 During the continuance of this Service Agreement, the Managing Director
shall refrain from performing any side-line activities, whether paid or
unpaid, for himself or any third party. Exempt herefrom are his
activities pursuant to no. 1.4 as well as honorary positions in the
political, cultural and social field are permitted insofar as they can
be performed without affecting the duties of the Managing Director
under this contract.
11.3 Any publications and papers relating to activities of the Company, or
its affiliates, as well as the acceptance of functions on the boards of
other companies as well as honorary positions on behalf of any
organization shall be subject to the Company's prior written consent.
Any such consent may be revoked at any time.
12. SURRENDER OF DOCUMENTS LAGEN
Upon expiration of this Agreement or in the event of release from
service, the Managing Director shall immediately return any objects and
documents including all notes and copies to the Company, and certify
the completeness, correctness and proper function of any object so
surrendered. Any right of retention shall be expressly excluded.
13. MODIFICATION AND AMENDMENTS
The cancellation as well as any amendments or modifications to this
Agreement shall only be valid in writing. This shall also apply to any
modification of this Clause.
14. FINAL PROVISIONS
14.1 This Service Agreement shall only be subject to German Law.
14.2 The Parties shall sign this Agreement in a German and an
English-language version. It is understood and agreed between the
Parties that in the event of any discrepancies between the two versions
the German version shall prevail.
14.3 Should any provision of this Agreement be or become ineffective wholly
or in part, or should any loophole requiring amendment appear, the
remaining provisions of this Agreement shall continue in full force and
effect. The Parties agree to replace any such provision so found
ineffective by such other provision as comes nearest to the legal and
economic intent of said provision found ineffective. In the same
manner, the Parties shall close any loophole requiring amendment that
might be encountered.
...............................,....................
...............................................
(TIWR Holding GmbH & Co. KG, represented by its General Partner TIWR Verwaltungs
GmbH which has the power to individually represent the TIWR Holding GmbH & Co.
KG; the TIWR Verwaltungs GmbH in turn represented by its managing directors Xxx
Xxxxx and Xxxxxx Xxxxx)
................................................
(Xxxxx Xxxxxxxxx)
