EXHIBIT 4.12
October 8, 2004
Re: Amended Secondment
Xx. Xxxxx Xxxxxxxx
Xxxxxxxx, Australia
Dear Xxxxx:
Congratulations on your promotion to Executive Vice President - International.
With this promotion, we offer you an Amended Secondment ("Agreement").
In light of the fact that you are now a member of the Group Management Team
("GMT"), Xxxxx Xxxxxx would like to amend your Secondment Agreement dated June
2, 2003 ("Secondment"), in consideration of the covenants contained herein, by
providing you the terms set forth below.
For the purposes of this Agreement, the word "Company" collectively means Xxxxx
Xxxxxx Building Products, Inc. ("JHBP") and Xxxxx Xxxxxx Building Products Pty
Ltd, known as Xxxxx Xxxxxx Australia ("XXX"). In other words, JHBP and XXX are
collectively referred to herein as "Company".
It is understood by you and the Company that this Agreement shall terminate and
supersede all prior employment agreements, service agreements, or other
agreements, promises and representations regarding the terms and conditions of
your employment between you and the Company or any of its subsidiaries or
affiliates, including but not limited to the Secondment, which is no longer of
any force or effect.
It is further understood by you and the Company that the terms and conditions of
your employment are otherwise governed by the policies and procedures of JHBP
applicable to similarly-situated executives of JHBP when you are working in the
United States, and by the policies and procedures of XXX applicable to
similarly-situated executives of XXX when you are working on assignment for XXX
in Australia.
It is a condition of the Agreement that you are granted a work permit for the
duration or your work assignment in Australia.
WORK FOR XXX IN AUSTRALIA
LOCATION OF SERVICE
1.01 The position is presently located at our Rosehill Office. The location of
your employment may be changed from time to time in accordance with the
Company's business needs. In the event of this occurring any such change
and the Company's relocation policy would first be discussed with you.
REPORTING RELATIONSHIP
2.01 You will report to Xxxxx Xxxxx, EVP Operations.
REMUNERATION
3.01 Your remuneration will be based on an annual salary of US$250,000.
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3.02 On the basis that you will be living away from your usual place of
residence, you will receive an additional taxable expatriate allowance of
US$20,000 per year.
3.03 Your total remuneration will be paid to you through your current USA
payroll.
3.04 By remaining on the USA payroll, you will continue to be eligible to
participate in the USA 401(k) plan, according to Company and plan
policies. The Company currently matches your contribution $1 for $1 up to
six percent of your salary up to the IRS maximum.
3.05 Salaries are reviewed on the basis of measured performance in July of each
year, starting July 2005.
3.06 Your remuneration relies on the fact that you are living away from home
and therefore you will be required to sign a declaration to that effect
annually (see attached), which the Company will retain with its records.
PERFORMANCE BONUS
4.01 Your target bonus for FY 05 will be 45% of your March 31, 2005 base salary
for April 1, 2004 to August 15, 2004 and 55% of your March 31, 2005 base
salary starting August 15, 2004. Your actual bonus will be calculated
based on JH's EP bonus plan parameters and your achievements against
agreed objectives and targets (IP). Your bonus will be split between EP
results (80%) and Individual Performance (20%).
4.02 The terms and conditions surrounding the plan are subject to alteration at
the discretion of the Company and participation is reviewed annually.
SHARE PLAN
5.01 You will be eligible to participate in the JHI NV Equity Incentive Plan
and continue to be treated as a U.S. employee for this consideration. The
decision on equity eligibility and amounts is made each year. For purposes
of that decision, you will be treated as a US employee.
TAXATION ADVICE
6.01 The Company will provide a tax adviser through PWC to assist in the
processing of tax returns and advice on tax matters associated with your
employment in Australia.
LEAVE
7.01 Annual Leave You will continue to accrue annual leave under the U.S.
vacation policy. Based on your tenure, you will accrue 3 weeks (120 hours)
per annum. You may continue to accrue up to a maximum of 240 hours based
on Company policies.
7.02 Home Leave JHBP will pay coach class return airfares to the USA for you
and your family, twice per annum. These tickets may be exchanged for
travel tickets elsewhere in the world but not for cash. They may also be
used to fly family members to Australia to visit.
CAR
8.01 The Company will provide both you and your spouse with cars; the company
will provide a car for your use consistent with the level of your current
Company-provided vehicle, and provide a car equivalent to a Honda Accord
or similar class car for your spouse's use. Auto insurance,
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routine maintenance and warranties associated with the costs for
maintenance of the cars will be paid by the Company. Business gasoline
costs will be reimbursed per local policy; expenses for personal mileage
will not be reimbursed.
POLICIES
9.01 Other policies applicable to you during your secondment will be as per the
XXX policies.
CONDITIONS OF RELOCATION TO AUSTRALIA
IMMIGRATION
10.01 Your employment in Australia will be dependant on successfully maintaining
the immigration status necessary for you to work in Australia.
10.02 If, at any stage, you intend to change your residency status from
temporary to permanent, you are to advise the Company.
PERSONAL ACCIDENT INSURANCE
11.01 JHBP provides 24-hour business travel accident insurance for all
expatriates, in accordance with the provisions of the applicable JHBP
insurance plan or insurance agreement.
MEDICAL / HOSPITAL INSURANCE
12.01 As an expatriate employee, you have the same Life, Medical, Dental, Vision
and Disability benefits as U.S. employees of JHBP. Since the PPO
(Preferred Provider) Medical Plan has no specific contracted providers in
your region, your medical benefits will be paid at the PPO level of
benefits for services rendered outside of the U.S.
WHEN APPROPRIATE, REMOVAL AND STORAGE CHARGES
13.01 The cost of packing, freight and insurance in transit of your personal
effects (excluding items of unique high value (e.g. pianos) or animals)
will be met by XXX.
13.02 Items of value that are not shipped may be placed in commercial storage at
the employee's home base. A reasonable cost of storage, removal into
storage and insurance on storage items will be met by XXX.
ACCOMMODATION
14.01 LONG-TERM ACCOMMODATION
To satisfy your long-term accommodation needs, XXX will continue to
reimburse you AUD $3,500 per month to cover the cost of a fully furnished
apartment or house, while you are working for XXX in Australia. It is also
agreed that XXX will pay this amount regardless of whether less or more
than this amount is actually incurred. Where the actual housing cost is
less than A$3,500, the payment will be broken into two components:
- the payment/reimbursement of the actual rent; and
- the balance paid as a taxable cash allowance, in which the company
will pay for the taxes.
EDUCATION FOR CHILDREN
15.01 XXX will continue to provide the costs associated with reasonable tuition
and appropriate fees, which may apply for your school-aged children while
you are working for XXX in Australia.
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LIABILITY FOR TAX PAYMENTS
16.01 You will continue to be tax equalized to the State of California for the
period of your work assignment for XXX in Australia. Tax equalization is
intended to equate the tax liability you incur during your overseas
assignment with that of a domestic employee under similar economic
circumstances. You will be reimbursed for any excess of U.S. or foreign
taxes you are required to pay beyond the U.S. and California taxes you
would have incurred on your base salary, bonus, if any, and imputed income
from group life insurance, if you had not taken the overseas assignment.
16.02 While you are on assignment for XXX in Australia, you will pay a
hypothetical tax in lieu of actual tax liabilities. The hypothetical tax
is representative of your tax responsibilities while on assignment. We
will have PricewaterhouseCoopers calculate the amount to be withheld.
GENERAL CONDITIONS
PERIOD OF NOTICE
17.01 Either party may terminate this Agreement by giving the other party thirty
(30) days notice in writing. The Company may elect to make a payment in
lieu of the whole or part of any period of notice given to the Company by
you, or by the Company to you. Of course, the Company may terminate this
Agreement immediately if it reasonably believes that you have engaged in
conduct which violates Company policy, or otherwise constitutes dishonest
activity, whether criminal or otherwise, including but not limited to
fraud, misrepresentation, theft of Company property, embezzlement, larceny
and misappropriation under applicable state and/or federal law.
TERMINATION OF XXX WORK ASSIGNMENT
18.01 In the event of termination of the XXX work assignment by XXX or you, XXX
will pay reasonable repatriation costs for you, your family and your
belongings to California, unless you were in breach of conditions applying
to your employment. Repatriation would have to occur within six months of
termination for this clause to apply.
18.02 Termination of employment by Redundancy, Resignation or other reason, will
mean conclusion of the transfer and you will be assisted with relocation
as described above, to California.
18.03 At the end of your XXX work assignment, JHBP will attempt to return you to
a position in California in the US business and repatriate you to that
location, unless you are released based on the Company's reasonable belief
that you engaged in conduct which violates Company policy or otherwise
constitutes dishonest activity, whether criminal or otherwise, including
but not limited to fraud, misrepresentation, theft of Company property,
embezzlement, larceny and misappropriation under applicable state and/or
federal law. Refer to Repatriation Conditions section below.
CONFLICT OF INTEREST
19.01 You agree to declare any potential conflict of interest, which might
affect the decisions of the Company in dealing with any third party, where
either you or an associate or family member has an interest in that third
party by way of employment or financial interest or any potential personal
gain.
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CONFIDENTIALITY
20.01 In accepting this appointment, you agree that during or after your
employment with the Company you will not disclose to anyone outside the
Company, or use in any way other than in the Company's business, any
information that may reasonably be said or understood to be confidential
in relation to the Company's activities.
20.02 Further, you agree that on termination of employment you will give up and
not take with you any material containing information, which may
reasonably be understood to be confidential in relation to the Company's
activities.
REPATRIATION CONDITIONS
REPATRIATION TO USA
21.01 Upon successful completion of your work assignment for XXX in Australia,
XXX will pay reasonable repatriation costs for you and your family to
return to California or location of JHBP assignment, including the return
coach class airfare. XXX will also pay reasonable costs associated with
the shipment of your belongings. In addition, JH will pay reasonable
housing costs for a period of up to one (1) month upon return to
California or location of JHBP assignment. You will also be provided with
tax assistance in relation to your return to the USA.
21.02 JH will reimburse the costs associated with purchasing a house in the USA.
The details of this will be addressed in a contract that moves you back to
the U.S.
CONDITIONS OF EMPLOYMENT
POST-TERMINATION CONSULTING PERIOD
22.01 Upon the termination of your employment with JHBP, you agree to:
(a) Consult to JHBP for two years for up to 100 hours/year. You agree to
do this, as well as to not violate any of the TRADE SECRET/
RESTRCTIVE COVENANTS set forth in this Agreement or in its policies
and procedures, in order to protect our Company's proprietary,
confidential business and manufacturing information. In exchange for
the payment of an amount equal to your annual base salary at the
time of termination (paid in monthly installments), in accordance
with the terms of a Xxxxx Xxxxxx Consulting Agreement, a format of
which is attached as a copy, for your general consideration. The
exact terms and conditions will be agreed upon when, and if, this
Agreement is prepared for execution. The Company will prepare this
Consulting Agreement, in final.
(b) Additionally, the Company may elect to extend the Consulting
Agreement for an additional two years, and you will agree to such
extension, in exchange for the amount equal to the annual base
salary for each year of extension.
RESTRICTIVE COVENANTS
23.01 Trade Secrets. Confidential and Proprietary Business Information.
(a) The Company has advised you and you have acknowledged that it is the
policy of the Company to maintain as secret and confidential all
Protected Information (as defined below), and that Protected
Information has been and will be developed at substantial cost and
effort to the Company and other companies in the Xxxxx Xxxxxx group
- these companies together with the Company are referred to in this
Agreement as the "Group." "Protected Information" means trade
secrets, confidential and proprietary
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business information of the Group, any information of the Group
other than information which has entered the public domain (unless
such information entered the public domain through effects of or on
account of you), and all valuable and unique information and
techniques acquired, developed or used by the Group relating to its
business, operations, employees, customers and suppliers, which give
the Group a competitive advantage over those who do not know the
information and techniques and which are protected by the Group from
unauthorized disclosure, including but not limited to, customer
lists (including potential customers), sources of supply, processes,
plans, materials, pricing information, internal memoranda, marketing
plans, internal policies, and products and services which may be
developed from time to time by the Group and any of their agents or
employees.
(b) You acknowledge that you have acquired and will acquire Protected
Information with respect to the Group and its successors in
interest, which information is a valuable, special and unique asset
of the Group's business and operations and that disclosure of such
Protected Information would cause irreparable damage to the Group.
(c) Either during or after termination of employment by the Company, you
shall not, directly or indirectly, divulge, furnish or make
accessible to any person, firm, corporation, association or other
entity (otherwise than as may be required in the regular course of
your employment) nor use in any manner, any Protected Information,
or cause any such information of the Group to enter the public
domain.
23.02 Non-Competition
(a) You agree that you shall not during your employment with the
Company, and, subject for a period of at least two (2) years, and up
to four (4) years, at the Company's discretion (assuming it
exercises its rights to have you engaged as a Consultant, as set
forth above), after the termination of the Agreement, directly or
indirectly, in any capacity, engage or participate in, or become
employed by or render advisory or consulting or other services in
connection with any Prohibited Business as defined in subsection
(c).
(b) You agree that you shall not, during your employment with the
Company, and, for a period of at least two (2) years, and up to four
(4) years at the Company's discretion (assuming it exercises its
rights to have you engaged as a Consultant, as set forth above),
after the termination of this Agreement, make any financial
investment, whether in the form of equity or debt, or own any
interest, directly or indirectly, in any Prohibited Business.
Nothing shall, however, restrict you from making any investment in
any company whose stock is listed on a national securities exchange;
provided that (i) such investment does not give you the right or
ability to control or influence the policy decisions of any
Prohibited Business, and (ii) such investment does not create a
conflict of interest between your duties hereunder and your interest
in such investment.
(c) "Prohibited Business" shall be defined as the business of:
(i) marketing or selling of fiber cement products, where the
marketing or selling of such products is a principal activity
of the business;
(ii) manufacturing or processing fiber cement products;
(iii) building, assembling, operating or maintaining plant and
equipment, where that plant and equipment is particular to the
manufacturing or processing of fiber cement products;
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(iv) manufacturing or processing raw materials for fiber cement
products where that manufacturing or processing is particular
to the raw material used in fiber cement products;
(v) research or development activities relating to
subsections(c)(i)-(iv); and
any branch, office or operation thereof, which is a competitor of the
Group or which has established or seeks to establish contact, in whatever
form (including, but not limited to solicitation of sales, or the receipt
or submission of bids), with any entity who is at any time a client,
customer or supplier of the Group (including but not limited to all
subdivisions of the federal government).
23.03 Non-Solicitation. From the date hereof until at least two (2) years, and
up to four (4) years at the Company's discretion, after your termination
of employment with the Company, you shall not, directly or indirectly (a)
encourage any employee or supplier of the Group or any of their successors
in interest to leave his or her employment with the Group or any of their
successors in interest, (b) employ, hire, solicit or cause to be employed,
hired or solicited (other than by the Group or any of their successors in
interest), or encourage others to employ or hire any person who within at
least two (2) years, and up to four (4) years at the Company's discretion,
prior thereto was employed by the Group or any of their successors in
interest, or (c) establish a business with, or encourage others to
establish a business with, any person who within at least two (2) years,
and up to four (4) years at the Company's discretion, prior thereto was an
employee or supplier of the Group or any of their successors in interest.
23.04 Disclosure of Employee-Created Trade Secrets Confidential and Proprietary
Business Information. You agree to promptly disclose to the Company all
Protected Information developed in whole or in part by you during your
employment with the Company and which relates to the Group's business.
Such Protected Information is, and shall remain, the exclusive property of
the Company. All writings created during your employment with the Company
(excluding writings unrelated to the Company's business) are considered to
be "works-for-hire" for the benefit of the Group and the Company shall own
all rights in such writings.
23.05 Survival of Undertakings and Injunctive Relief
(a) The provisions of these RESTRICTIVE COVENANTS of this Agreement
shall survive both the termination of your employment with the
Company and the termination of the Agreement, irrespective of the
reasons for such termination.
(b) You acknowledge and agree that these RESTRICTIVE COVENANTS imposed
upon you by this Agreement and the purpose of such restrictions are
reasonable and are designed to protect the Protected Information and
the continued success of the Company without unduly restricting your
future employment by others. Furthermore, you acknowledge that, in
view of the Protected Information which you have or will acquire or
have or will have access to and in view of the necessity of these
restrictions, any violation of them would cause irreparable injury
to the Company and its successors in interest, with respect to the
resulting disruption in their operations. By reason of the foregoing
you consent and agree that if you violate any of these restrictions,
or RESTRICTIVE COVENANTS, the Company and its successors in interest
as the case may be, shall be entitled, in addition to any other
remedies that they may have, including money damages, to an
injunction to be issued by a court of competent jurisdiction,
restraining you from committing or continuing any violation of such
Sections of this Amendment.
In the event of any such violations of these RESTRICTIVE COVENANTS,
you further agree that the time periods set forth in such Sections
shall be extended by the period
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of such violation, and you consent to the jurisdiction of the
Superior Court for the County of Orange, State of California, as the
competent court to hear and to determine any action in equity or law
filed by the Company against you with respect to its necessity to
protect itself under these RESTRCITIVE COVENANTS.
TERMINATION
24.01 Termination of Employment by Voluntary Resignation /Death /Disability.
(a) Your employment under the Agreement may be terminated:
(i) Upon your voluntary resignation in accordance with the
notification requirement provided in the Agreement;
(ii) Upon your death, the Agreement, and your employment hereunder
shall terminate immediately and without notice by the Company;
or
(iii) In the event of your inability to perform your duties or
responsibilities thereunder, as a result of a Permanent
Disability (as defined below) upon written notice by the
Company. A "Permanent Disability" occurs when for a period of
ninety (90) consecutive calendar days, or an aggregate of one
hundred twenty (120) calendar days during any calendar year
(whether or not consecutive) you are unable to perform your
duties or responsibilities hereunder as a result of a mental
or physical ailment or incapacity. Upon the occurrence of a
Permanent Disability, the Company will evaluate your condition
and determine whether or not to send written notice of your
termination.
(b) Upon a voluntary resignation, you shall not be entitled to payment
of any compensation other than salary under the Agreement, as
amended, earned up to the date of such resignation, any accrued but
unpaid vacation days, and any stock options, warrants or similar
rights which have vested at the date of such resignation. The
Company, in its sole and absolute discretion, may decide to continue
to pay you your Annual Base Salary, for up to two (2) years after
your voluntary resignation, in return for you not violating the
RESTRICTIVE COVENANTS and/or provisions therein, for an equivalent
period.
(c) Upon your death, the Company shall pay or grant, to such person as
you designate in a notice filed with the Company, or, if no such
person shall be designated, to your estate as a lump sum death
benefit, an amount equal to any compensation under the Agreement, as
amended, earned up to the date of your death, including salary and
any accrued but unpaid vacation days. In addition, any stock options
or warrants which have vested at the time of your death will be
exercisable by your estate in accordance with the Company's Equity
Incentive Plan. Your designated beneficiary or the executor of your
estate, as the case may be, shall accept the payment provided for in
this section, in full discharge and release of the Company of and
from any further obligations under the Agreement, as amended.
(d) Upon your permanent disability, you shall be entitled to the benefit
of disability or other relevant insurance or benefits provided. You
shall not be entitled to payment of any compensation other than
salary under the Agreement, as amended, earned up to the date of
such permanent disability, any accrued but unpaid vacation days, and
any stock options, warrants or similar rights which have vested at
the date of such termination. The Company, in its sole and absolute
discretion, may decide to continue to pay you your Annual Base
Salary, for up to two (2) years after your voluntary resignation, in
return for you not violating the RESTRICTIVE COVENANTS
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for an equivalent period and your execution, without revocation, of
a Company Release of Claims upon the effective date of the
termination of your employment.
24.02 Termination for Cause.
(a) The Company may terminate your employment for Cause by giving you
written notice of such termination. For purposes of the Agreement,
as amended, "Cause" for termination shall mean:
(i) the willful failure or refusal to carry out the reasonable
directions of the Chief Executive Officer or Board of
Directors, which directions are consistent with your duties as
set forth under the Agreement;
(ii) a willful act by you that constitutes gross negligence in the
performance of your duties under the Agreement, as amended,
and which materially injures the Company. No act, or failure
to act, by you shall be considered "willful" unless committed
without good faith and without a reasonable belief that the
act or omission was in the Company's best interest; or
(iii) a conviction for a violation of a state or federal criminal
law involving the commission of a felony or other crime
involving moral turpitude.
(b) Upon termination for Cause, you shall not be entitled to payment of
any compensation other than salary under the Agreement earned up to
the date of such termination, any accrued but unpaid vacation days,
and any stock options, warrants or similar rights which have vested
at the date of such termination. The Company, in its sole and
absolute discretion, may decide to continue to pay you your Annual
Base Salary, for up to two (2) years after such termination for
Cause, in return for you not violating the RESTRICTIVE COVENANTS for
an equivalent period and your execution, without revocation, of a
Company Release of Claims upon the effective date of the termination
of your employment.
24.03 Termination Without Cause. Should your employment be terminated for a
reason other than as specifically set forth above:
(a) You shall be paid the salary earned up to the date of such
termination under the Agreement any accrued but unpaid vacation
days, and any stock options, warrants or similar rights which have
vested at the date of such termination.
(b) In addition, the Company, in its sole and absolute discretion, may
decide to continue to pay you additional amounts (in monthly
installments) equal to your Annual Base Salary as of the date of
termination of employment in accordance with the Company's normal
practices for other senior executives, for up to two (2) years
following your termination, in return for you not violating the
provisions of the RESTRICTIVE COVENANTS above, for an equivalent
period and your execution, without revocation, of a Company Release
of Claims at that time.
(c) All of the stock options, warrants, retirement benefits and other
similar rights, if any, granted by the Company to you that are
vested at the date of the termination of your employment, shall
remain vested. All stock options that will vest between the date of
such termination of employment and the completion of the Consulting
Agreement will continue to vest on the vest dates stipulated in the
grant document(s). All stock options unvested as of the completion
of the Consulting Agreement will immediately expire. All stock
options vested as of the completion of the Consulting Agreement will
remain exercisable until the earlier of (i) the date such Stock
Options would expire in accordance with their terms, and (ii) 90
days after the date of completion of the
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Consulting Agreement, unless terminated earlier per the terms of the
Consulting Agreement.
24.04 No Mitigation. You shall not be required to mitigate the amount of any
payment provided for in the Termination without Cause Section, above, by
seeking other employment or otherwise, nor shall the amount of any payment
provided for under this section be reduced by any compensation earned by
you, as a result of employment by another company, self-employment or
otherwise.
In acknowledgment of your agreement to the terms and conditions of this
Agreement, please sign and return to Xxxxx XxXxxxxxxx, in Mission Viejo HR, the
duplicate copy of this letter.
XXXXX XXXXXX BUILDING PRODUCTS, INC.,
A California corporation
By: /s/ Xxxxx Xxxxx Oct 13, 2004
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Xxxxx Xxxxx date
Executive VP Operations
Xxxxx Xxxxxxxx, an individual
/s/ Xxxxx Xxxxxxxx Oct 19, 2004
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Xxxxx Xxxxxxxx date
