CONSULTING AGREEMENT
THIS AGREEMENT is entered into as of the 1st day of December,
1998, by and between Willamette Industries, Inc., an Oregon corporation
("Corporation"), and Xxxxxxx Xxxxxxxxx ("Xxxxxxxxx").
WHEREAS, Swindells has served as an executive officer of
Corporation for many years, is now its Chairman of the Board and Chief Executive
Officer and has knowledge and experience of significant value to Corporation;
and
WHEREAS, in order to provide for an orderly management
succession it is presently contemplated that Swindells will retire as Chairman
and Chief Executive Officer of Corporation, effective December 1, 1998; and
WHEREAS, Corporation wishes to continue to avail itself of
Swindells' experience and knowledge by retaining Swindells to provide consulting
services to Corporation with respect to the business of Corporation; and
WHEREAS, Swindells desires to perform such services;
NOW, THEREFORE, in consideration of the foregoing, and of the
mutual agreements herein contained, Swindells and Corporation agree as follows:
1. Consulting Services.
(a) Term of Service. Corporation hereby agrees that
it will engage Swindells, and Swindells agrees that he will serve, as a
consultant to Corporation for a period (the "Term") commencing on December 1,
1998, and ending on November 30, 1999, or earlier in the event of death or
disability of Swindells. Swindells will be deemed disabled only if, on the basis
of medical evidence acceptable to the Board of Directors of Corporation,
Swindells has a physical or mental condition resulting from unavoidable
impairment of mind or body which can be expected to result in death or to be of
long-continued and indefinite duration and which, in the discretion of the Board
of Directors of Corporation, prevents Swindells from engaging in any employment
or occupation for remuneration or profit. Following November 30, 1999, the Term
will extend for three consecutive one-year periods unless terminated by
Corporation or Swindells upon notice given not less than 30 days prior to the
commencement of any such one-year period; provided however that such extended
Term shall not extend beyond the death or disability of Swindells, or the
retirement of Swindells from the Board of Directors of Corporation.
(b) Nature of Consulting Services. To the extent
reasonably requested by Corporation, Swindells shall consult with and advise
Corporation with respect to acquisitions and strategic planning, capital
expenditures, product development and general corporate and organizational
matters. The Corporation shall not direct the manner or means by which Swindells
performs services under this Agreement. The consulting services shall be
provided in Portland, Oregon at times determined by Swindells except as the
parties may otherwise agree. Corporation shall provide Swindells with adequate
information and resources to allow Swindells to perform effectively the services
contemplated by this Agreement.
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(c) Nature of Relationship. For all purposes,
including that of determining Swindells' eligibility for participation in
Corporation's employee benefit plans, Swindells' relationship to Corporation
during the Term shall be that of an independent contractor and not an employee.
2. Agreement Not to Compete. Swindells hereby agrees that,
during the Term, he will not, directly or indirectly, either as principal,
agent, stockholder, employee or in any other capacity, without the prior
approval of the Board of Directors of Corporation, engage in any activity or be
employed by, assist or have an equity interest in, any business or other entity
that competes in any material respect with Corporation; provided, however, that
such prohibited activity shall not include the ownership of one percent (1%) or
less of the voting securities of any publicly traded corporation regardless of
the business of such corporation. Swindells acknowledges and agrees that a
material breach by Swindells of the provisions of this Section will constitute
such damage as will be irreparable and the exact amount of which will be
impossible to ascertain and for that reason agrees that Corporation will be
entitled to an injunction to be issued by any court of competent jurisdiction
restraining and enjoining Swindells from violating the provisions of this
Section. The right of injunction shall be in addition to and not in lieu of any
other remedy available to Corporation for such breach or threatened breach,
including the recovery of damages from Swindells.
3. Confidential Information. Swindells shall continue to hold
confidential for the benefit of Corporation all secret or confidential
information, knowledge or data relating to Corporation that shall have been
obtained by Swindells during his employment by Corporation or during the Term
and that shall not have become public knowledge.
4. Fees for Services. In consideration of the consulting
services to be performed by Swindells hereunder and for the covenants of
Swindells contained herein, Corporation shall pay Swindells consulting fees at
the rate of $10,000 per month during the Term. The obligation of Corporation to
make the foregoing payments to Swindells shall terminate upon the death or
disability of Swindells except with regard to accrued and unpaid amounts. While
receiving fees for services under this Agreement, Swindells shall not receive
annual retainer payments made to non-employee directors of the Corporation, but
shall receive fees for board and committee meetings attended and all other
amounts payable to non-employee directors of Corporation.
5. Other Matters. During the Term, Corporation shall provide
Swindells with the following:
(a) Expenses. Reimbursement for all reasonable travel
and other business expenses incurred by Swindells in the performance of his
duties hereunder;
(b) Office Space; Secretary. Office space, together
with the services of a secretary, appropriate to the status of Swindells
hereunder; and
(c) Club Expenses. Dues, fees and expenses for the
following clubs: Arlington Club.
(d) Parking in the building in which Swindells'
office is located.
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6. Scope of Agreement. Nothing in this Agreement shall limit
such rights as Swindells may have under any other agreements with Corporation.
Amounts which are vested benefits or which Swindells is otherwise entitled to
receive under any plan or program of Corporation shall be payable in accordance
with such plan or program.
7. Indemnification. Corporation shall indemnify Swindells and
his legal representatives to the fullest extent permitted by the laws of the
state of Oregon, the Articles of Incorporation, or the Bylaws of Corporation as
in effect as of the date of this Agreement and from time to time thereafter
against all claims, loss, damages, costs, charges and expenses whatsoever
incurred or sustained by him or his legal representatives in connection with any
action, suit or proceeding to which he or his legal representatives may be made
a party by reason of the services performed by Swindells pursuant to this
Agreement. Corporation will, upon request by Swindells, promptly advance or pay
any amounts for costs, charges or expenses (including, but not limited to,
reasonable legal fees and expenses incurred by counsel retained by Swindells) in
respect of his right to indemnification hereunder, subject to a later
determination as to Swindells' ultimate right to receive such payment.
Swindells' rights under this Agreement shall be in addition to, and not in lieu
of, any other rights Swindells may have to indemnification by Corporation.
8. Successors. This Agreement is personal to Swindells and
without the prior written consent of Corporation shall not be assignable by
Swindells. This Agreement shall inure to the benefit of and be binding upon
Corporation and its successors. Corporation will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business of Corporation to expressly assume and agree
to perform this Agreement in the same manner and to the same extent that
Corporation would be required to perform it if no such succession had taken
place.
9. Miscellaneous.
(a) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the state of Oregon, without
reference to principles of conflict of laws.
(b) Notices. All notices and other communications
hereunder shall be in writing and shall be given by hand delivery to the other
party or by certified mail, return receipt requested, postage prepaid, addressed
as follows:
If to Swindells:
Xx. Xxxxxxx Xxxxxxxxx
0000 X.X. Xxxxxx Xxxxx
Xxxxxxxx, Xxxxxx 00000
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If to Corporation:
Willamette Industries, Inc.
3800 First Interstate Tower
0000 X.X. Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Attention: Corporate Secretary
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee or three days following mailing, as
provided above, whichever shall first occur.
(c) Severability. The invalidity or unenforceability
of any provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement.
(d) Withholding. Corporation may withhold from any
amounts payable under this Agreement such amounts as shall be required to be
withheld pursuant to any applicable law or regulation.
(e) Entire Agreement; Amendment. This Agreement
contains the entire understanding of Corporation and Swindells with respect to
the subject matter hereof, and may not be amended or modified otherwise than by
a written agreement executed by the parties hereto or their respective
successors and legal representatives.
IN WITNESS WHEREOF, Swindells has hereunto set his hand and,
pursuant to the authorization from its Board of Directors, Corporation has
caused this Agreement to be executed in its name on its behalf, all as of the
day and year first above written.
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Xxxxxxx Xxxxxxxxx
WILLAMETTE INDUSTRIES, INC.
By -------------------------------------
Xxxxx X. XxXxxxxxx, President
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