EMPLOYMENT AGREEMENT
EXHIBIT
10(xxvi)
BETWEEN
Xxxxxxx
Doors France SAS, a “société par actions
simplifiée” whose registered office is located at rue Xxxxxxx
Xxxxxxxx, ZI de Trepillot, 25000 Besançon, France, registered with the
Registry of Trade and Companies of Besançon under number 307 104 315
(the “Company”),
represented by Xxx. Xxxxxxx Xxxxxx, President, duly authorised for the purposes
hereof,
AND
Thierry
Paternot, whose address is 00 xxxxxx xx xx Xxxxxxxxxxx, 00000 Xxxxx, Xxxxxx
(the “Executive”),
IT
IS HEREBY AGREED THAT:
ARTICLE
1 - JOB
DESCRIPTION
The
Executive shall be employed by the Company as a senior executive (not as
corporate officer) in the capacity of “President-Europe” for The
Xxxxxxx Works’ tool’s business in Europe (“The
Xxxxxxx Works Europe”).
He shall also exercise the functions of “President and CEO”
(Président-) of
Facom SAS.
In his
capacity as the chief executive officer of The Xxxxxxx Works Europe, the
Executive shall be responsible for leading and coordinating the activities of
The Xxxxxxx Works Europe. In his capacity as President and CEO of Facom SAS,
the Executive shall manage Facom SAS and ensure the smooth running of its
corporate bodies. The Executive shall also perform such other tasks that are
normally attached to his positions or specifically assigned to
him.
The
Executive shall perform his functions under the authority and within the
instruction scope he is provided with by the chief executive officer of The
Xxxxxxx Works currently Xx.
Xxxxxxxx or to
any other manager designated by the Company for this purpose.
The
Executive agrees to devote all of his attention and energies to the performance
of the duties assigned to him and the development of the activities and
promotion of the interests of The Xxxxxxx Works Europe and Facom SA. He shall
perform such duties faithfully, diligently and to the best of his abilities and
subject to such laws, rules, regulations and policies from
time to
time applicable to the Company’s employees. The Executive agrees to
refrain from engaging in any activity that does, will or could reasonably be
deemed to conflict with the best interests of The Xxxxxxx Works and
Affiliates.
This
agreement is governed by the National Collective agreement for Metallurgy
(“Convention
Collective Xxxxxxxxx xx xx Xxxxxxxxxxx xx000”) (the
“Collective
Agreement”).
ARTICLE
2 - EXCLUSIVITY
The
Executive formally declares that he is not bound to any other company, that he
has left his previous employer free from all obligations and that he is not
presently subject to any non-competition clause whatsoever.
The
Executive undertakes to devote all his work time and effort for the exclusive
benefit of the Company and he may therefore not exercise any other professional
activity throughout the duration of this agreement without the prior written
express approval of the Company.
ARTICLE
3 - DURATION
OF AGREEMENT
This
agreement is entered into for an indefinite duration starting on the date of
the acquisition of Facom SA by the Company or its affiliates (the
“Closing
Date”),
without any trial period.
The
Executive’s length of service shall be computed for all purposes, other
than for a termination of employment, as from December 1st, 2002,
which is the date on which he commenced employment with the Facom SA group.
Each of
the parties shall have the right to terminate this agreement at any time,
subject to a prior written notice of six (6) months.
The
parties hereby acknowledge and agree that The Xxxxxxx Works and the Company
have agreed to grant the Executive stock options, inter
alia, to
serve as a severance package. Therefore, any severance payment the Executive
may be entitled to under the Collective Agreement and/or French law shall be
considered as included into the gains made under the stock options granted
under this Agreement.
ARTICLE
4 - REMUNERATION
4.1
The
Executive will be paid, in remuneration for his activities, an annual gross
base salary equal to two hundred and thirty thousand Euros (€230,000),
which shall be paid to him in twelve monthly instalments.
4.2
To take
into account the importance of the travels that the Executive shall be required
to make and given the constraints associated with these travels and their
frequency, the Executive is entitled to a travel allowance (“prime
d’expatriation”). This
allowance shall be proportionate to the number of travel days abroad per year.
The travel allowance, to which
the
Executive is entitled, shall be of one thousand Euros (€1,000) on average
per day spent abroad in relation to his professional duties as Executive and
will be subject to the legal applicable provisions, namely those of Article 81
A II of the French Tax Code.
4.3
The
Executive shall be entitled to an annual bonus depending on the attainment of
performance targets. The targets shall be based on the agreed business plan, as
revised as the case may be in light of the economic circumstances. The bonus
payable for a given year shall be equal to a maximum of seven hundred fifty
thousand Euros (€750,000) per year upon achievement of 100% of the
targets. The bonus for a year, if payable, shall be paid in or prior to March
of the following year.
4.4
All the
elements of remuneration cited above shall be subject to deduction of the
employee’s share of social security, supplemental retirement, invalidity
and death, unemployment insurance contributions, and CSG and CRDS, and any
other applicable withholding.
4.5 It is
expressly agreed that any premium or bonus that may be granted by the Company,
other than that granted in 4.2 and 4.3 above shall not be part of the
remuneration and shall always remain a revocable grant.
ARTICLE
5 - STOCK
OPTIONS
The
Executive shall be granted two hundred thousand (200,000) stock options of The
Xxxxxxx Works on the later to occur of (i) the Closing Date or (ii) January
1st, 2006. Such options shall be granted pursuant to the terms of the stock
option certificate set forth in Exhibit
A to this
agreement. In respect of such stock options, the Executive hereby undertakes to
meet any and all obligations necessary to be entitled, and allow the Company
and The Xxxxxxx Works to be entitled, to the benefit of favorable tax and
social security treatment provided by Articles 80 bis and 163 bis C of the
French Tax Code and by the second paragraph of Article L. 242-1 of the French
Social Security Code, as such may be amended or succeeded from time to
time.
ARTICLE
6 - SHARES
The
Executive shall be granted free shares (restricted stock) of The Xxxxxxx Works
on the later to occur of (i) the Closing Date or (ii) January 1st, 2006 with a
value of one million five hundred thousand Euros (€1,500,000). The number
of such shares that the Executive shall be entitled to retain, if any, shall be
determined in accordance with the terms and conditions of Long Term Performance
Award Program (the “Program”) under The Xxxxxxx Works’ 1997 or
2001 Long Term Incentive Plans, as amended, for the 2006-2008 performance
period as soon as reasonably practicable after the completion of such period.
It is the intention of the parties that the general terms and conditions of the
Program that apply to the Executive shall operate in the same manner as apply
to other senior The Xxxxxxx Works executives, but that the Program shall be
modified to provide for the initial grant of actual shares in order to achieve
favorable tax treatment and to comply with French tax and legal requirements.
Attached
as Exhibit B is a description of the 2005-2007 Program. The Company and The
Xxxxxxx Works expect the 2006-2008 Program to be similar, but retain the right
to modify the Program in any manner except that, with respect to the Executive,
such modifications shall not be inconsistent with the following: (i) if
threshold, target or maximum performance is achieved under the Program, the
Executive shall be entitled to retain, respectively, one-third (1/3),
two-thirds (2/3) and one hundred percent (100%) of the shares granted to him
pursuant the Program for the 2006-2008 performance period; (ii) for performance
between these benchmarks, the number of shares the Executive shall be entitled
to retain shall be pro rated in the manner as apply to other The Xxxxxxx Works
executives; (iii) the free shares granted pursuant to this Article 6 shall be
granted in book entry form and shall not be entitled to receive any dividends
or enjoy voting rights until the number of shares the Executive is entitled to
retain has been determined in accordance with the Program for the 2006-2008
performance period.
In
respect of the shares to be granted pursuant to the Program, the Executive
hereby undertakes to meet any and all obligations necessary to be entitled, and
allow the Company and The Xxxxxxx Works to be entitled, to the benefit of
favorable tax and social security treatment provided by Articles 80
quaterdecies and 200 A. bis of the French Tax Code and by the second paragraph
of Article L. 242-1 of the French Social Security Code, as such may be amended
or succeeded from time to time.
ARTICLE
7 - PLACE
OF WORK
The
Executive’s place of work shall be in Ile
de France.
In
addition, it is expressly understood and agreed that the Executive will be
required to travel in France, Europe or overseas in fulfilment of his duties as
reasonably required.
ARTICLE
8 - WORKING
TIME
The
Executive’s remuneration, as defined in Article 4 above, which was agreed
upon in light of both the special nature of the functions assigned to him and
the importance of his responsibilities, will remain independent of the time
that the
Executive, who
benefits from the largest autonomy in the organization of his working time,
will devote to the performance of his functions.
Regarding
both his remuneration and the importance of his responsibilities, the
Executive shall be
considered as a key executive (“cadre
dirigeant”)
in accordance with the provisions of article L. 212-15-1 of the French Labor
code and therefore he will not be governed by most of the legal and
conventional rules on working hours.
ARTICLE
9 - EXPENSES
The
Executive shall be reimbursed his reasonable business expenses actually
incurred in carrying out his duties, upon presentation of the relevant receipts
and in conformity with the Company’s expense reimbursement
policy.
ARTICLE
10 - COMPANY
CAR
The
Company will provide the Executive with an automobile of the type Volvo S80
with a driver for use in the execution of his duties, which shall remain the
Company’s property. The automobile is provided for business use. The
Executive is, however, authorized to make personal use of the vehicle outside
the execution of his duties, on condition that he pays for the fuel expenses
that correspond to such personal use.
The
personal use of the company car shall be deemed a benefit in kind, subject to
the applicable social security contributions and tax applicable within the
Company.
Subject
to the submission of adequate invoices and receipts and a record of the
kilometers effected, the Company shall reimburse the Executive for the petrol
and maintenance costs incurred for business use, in accordance with the
Company’s internal rules and rates.
Insurance
costs relating to coverage of professional risks shall be paid for by the
Company, which shall subscribe a fully comprehensive insurance policy. In the
event of an accident, the Executive shall inform the management within a
maximum period of 48 hours and shall comply with the law and the provisions
contained in the insurance policy, so that the liability of the Company shall
not be engaged in any respect whatsoever. The Executive represents that he
holds a valid driving license as of the date hereof, and expressly undertakes
to notify the Company of any suspension measures to which he may be
subject.
Subject
to a one-month prior notice, the Company is entitled to withdraw the car for
the Company’s needs. The vehicle must also be returned in the event of the
termination of the Executive’s employment agreement for whatever grounds
whatsoever and from the moment of the effective cessation of his
duties.
ARTICLE
11 - SOCIAL
BENEFITS
The
Executive shall benefit from all retirement and insurance benefits granted by
the Company, including inter alia a supplemental medical insurance of the type
currently provided to the Executive by Gras Savoye.
ARTICLE
12 - PAID
VACATION
The
Executive shall be entitled to vacation as provided by law and by the
Collective Bargaining agreement. Holiday periods shall be set by agreement
between the Company and the Executive, taking into account business
requirements.
ARTICLE
13 - CONFIDENTIALITY
The
Executive shall not, directly or indirectly, either during the period of his
employment or after the termination thereof, give, procure or supply, in any
manner whatsoever, to any person, firm, association or company, the name or
address of any client of The Xxxxxxx Works or company controlled by,
controlling, or under common control with The Xxxxxxx Works, including but not
limited to the Company and Facom SA (“The Xxxxxxx Works and
Affiliates”), or any trade secret or confidential information concerning
the business of The Xxxxxxx Works and Affiliates and their personnel, except
with the written authorization of a representative of The Xxxxxxx
Works.
Information
which is considered confidential includes, in particular, all technical,
commercial or financial information (whether or not this information is
recorded in a written document or in any other medium) which relates to The
Xxxxxxx Works, its subsidiaries, shareholders or representatives.
ARTICLE
14 - NON-SOLICITATION
UNDERTAKING
The
Executive undertakes, for a period of two (2) years as from the date of his
actual departure from the Company not to propose to any person who was, at the
time of the Executive’s actual departure or during the twelve (12) months
preceding his departure, an employee of The Xxxxxxx Works and Affiliates, or to
attempt by any means, directly or indirectly, to persuade or incite this person
to accept another employment or to leave The Xxxxxxx Works and
Affiliates.
ARTICLE
15 - RETURN
OF DOCUMENTS AND INFORMATION
On the
day of the termination of his responsibilities in the Company, the Executive
shall promptly return any material or assets in whatever form which have been
put at his disposal by The Xxxxxxx Works and Affiliates, including the company
car, together with all written documents or recordings containing confidential
information as described above.
ARTICLE
16 - NON-COMPETITION
Given
the extreme sensitiveness of the know-how and technical and commercial
information to which the Executive has access in the framework of his functions
and the extremely competitive nature of the activities of The Xxxxxxx Works and
Affiliates, the parties expressly agree on the necessity of a non-compete
obligation in order to protect the legitimate interests of The Xxxxxxx Works
and Affiliates. Moreover, the Executive understands that in light of his
training, this provision does not hinder his capacity to find a new
position.
In the
event this agreement is terminated by either of the parties, for any reason
whatsoever, the Executive expressly undertakes not to enter the service of
another company or division of a company in the European Union manufacturing or
selling products or services that could compete with those of The Xxxxxxx Works
and Affiliates, to create in the European Union a firm of the same type or to
participate directly or indirectly therein in any capacity.
For this
purpose, the Executive undertakes, in particular, for any product or service
that might compete with the products or services of The Xxxxxxx Works and
Affiliates, not to visit or contact their clients or to deal with any
individual or company that was a client of The Xxxxxxx Works and Affiliates and
with whom the Executive was in contact at any time during the three (3) years
preceding his actual departure from the Company.
It is
expressly agreed that the performance of this clause is limited to a period
of one
year, renewable one time at the Company’s option for an additional year,
as from the date of the Executive’s actual departure from the
Company.
During
this period of non-competition, the Executive will receive a monthly indemnity
corresponding to 60%
of his
average monthly salary received over the last 12 months preceding the
termination of the employment agreement, it being understood that this
indemnity will be subject to social security contributions.
It is
agreed that, in any case, the Company shall be entitled waive this clause,
provided however that it informs the Executive thereof by registered letter
with return receipt requested within the eight (8) days following the
notification of the termination of the employment agreement.
The
parties expressly agree that each restriction mentioned above applies and must
be interpreted independently from the others so that if one of the restrictions
is considered void, the others will remain in force and produce their
effect.
ARTICLE
17 - PENALTY
CLAUSE
Any
violation of the provisions stipulated in articles 2 (exclusivity), 13
(confidentiality), 14 (non-solicitation) and 16 (non-competition) above shall
be sanctioned by the payment of an indemnity at least equal to the remuneration
received by the Executive during the last six months of the existence of this
agreement, although the Company reserves the right to prove a greater prejudice
and to obtain the cessation of the violation and obtain compensation by all
legal means.
ARTICLE
18 - GOVERNING
LAW - COMPETENT COURTS - ASSIGNMENT
This
agreement is governed by French law, both with respect to its performance and
its termination. Any dispute relating hereto shall be subject to the exclusive
jurisdiction of the French courts. The Company may assign this agreement to any
French affiliate of The Xxxxxxx Works.
ARTICLE
19 - ENTIRE
AGREEMENT
This
agreement replaces and supersedes any prior oral or written agreement or
statement with respect to the terms of the Executive’s employment with the
Company.
|
Executed
in two (2) originals, on
_____________ |
||
|
For
the Company
by
Xxx. Xxxxxxx Xxxxxx, President |
The
Executive |
|
|
|
|
|
STANLEY
DOORS SAS
00
xxx Xxxxxxxx
00000
Xxxxxxxx
|
Xxxxxxx
Paternot
00
Xxxxxx xx xx Xxxxxxxxxxx
00000
Xxxxx |
February
18 2006
Sir,
Following
our various discussions related to the remuneration described in your works
contract dated 15 February 2006.
We
hereby gladly confirm that the components of your remuneration as provided in
sections 4.1 and 4.2 of your works contract, including your remuneration as
corporate officer and President of Facom SAS will not, cumulatively, give rise
to an annual gross remuneration of less than five hundred thousand Euros (500
000€), nor be of more than such amount.
As a
matter of form, we thank you for sending us a copy of this document with your
approval and signature.
Sincerely
yours
| Xxxxxxx Xxxxxx |
Thierry
Paternot |
|
| President | ||
