MANAGEMENT AGREEMENT
Exhibit 10.5
BETWEEN :
SAMSONITE EUROPE N.V., having its registered office at 9700 Oudenaarde (Belgium), Westering 17,
hereinafter referred to as “the Company”,
represented for the purpose of the present agreement (the “Agreement”) by Xx. Xxxxxxx X. Xxxxx, director, and Xx. Xxxx Xxxxxx, director.
AND :
Xx. Xxxxxxxx XXXXXXX, having his residence at Xxxxxxxxxxxxx 00 X0, X-0000 Xxxx, Xxxxxxx,
hereinafter referred to as “Xx. XXXXXXX”.
WHEREAS Xx. XXXXXXX will execute the day-to-day management of the Company on a self-employed basis;
WHEREAS the Company and Xx. XXXXXXX wish to determine in writing the conditions under which the latter will perform his office as managing director.
IT HAS BEEN AGREED UPON AS FOLLOWS :
Article 1 — Object of the agreement
1. Xx. XXXXXXX will be in charge of the day-to-day management of the Company and its Subsidiaries, in line with the policies and applicable strategic decisions applicable within the SAMSONITE GROUP, as they may be modified from time to time. Day-to-day management in this Agreement shall have the meaning as referred to in Section 525 of the Belgian Company Code and no such duties shall take place in the United States of America. For the purpose of this Agreement, “Subsidiaries” shall mean any corporation or other entity of which the securities or other ownership interests having the voting power to elect a majority of the board of directors or other governing body are, at the time of determination, owned by the Company, directly or through one or more subsidiaries of the Company.
2. The Company commits itself to have Xx. XXXXXXX appointed by the General Assembly of Shareholders as director with effect on 25 June 2004 and by the board of directors of the Company (the “Board of Directors”) as managing director also with effect on the same date.
Article 2 — The conditions of the underlying agreement
1. Xx. XXXXXXX shall perform and discharge his duties, powers, functions and services hereunder in good faith, in accordance with the requirements of applicable law, rules and regulations, and with the standards set forth herein and in any event with the due care and skill and to the standards which would be expected from a competent (managing) director providing services of the kind described herein. Xx. XXXXXXX shall perform the management of the Company as a normal prudent person, with proper diligence and in accordance with generally accepted and consistently applied business practices.
2. Xx. XXXXXXX shall perform the Agreement on a self-employed basis, as his full professional activities for the benefit of the Company fall within the realm of his corporate office (in the meaning of Section 2 of the Royal Decree of 19 December 1967). Xx. XXXXXXX will receive no direct instructions from the Company in relation to the organisation and performance of the duties and services to be rendered under this Agreement, nor will the Company exercise any complete or partial employer’s authority in relation to Xx. XXXXXXX. Xx. XXXXXXX will not act, nor will he consider himself as being an employee, in view of the fact that his relation with the Company is not based upon an employment contract.
3. Xx. XXXXXXX is solely liable for all his personal social obligations in relation to the execution of this Agreement. Xx. XXXXXXX will be affiliated with a social security fund for independent workers and will submit to the Company proof of each payment to this social security fund within 30 days following every calendar quarter.
4. Xx. XXXXXXX will spend the time and attention which is reasonably required to perform his duties and responsibilities under this Agreement. Prior to the commencement of this Agreement and during the execution thereof, Xx. XXXXXXX will inform the Company in writing of any other positions (whether remunerated or not) he holds in any other company or association. The Company has the right in the reasonable view of the Company to request Xx. XXXXXXX to forfeit such positions to the extent they could possibly hinder the proper execution of this Agreement; provided that Xx. XXXXXXX may continue to serve in his current capacity on the board of directors of the Italian company, Xxxxx, so long as such service does not require Xx. XXXXXXX to spend more than 7 days per annum engaged in such activities.
5. Xx. XXXXXXX is allowed to use the infrastructure, logistical support and the documentation of the Company necessary for the performance of his duties and obligations under this Agreement.
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6. As a corporate officer, Xx. XXXXXXX agrees to respect all instructions in relation to safety and health, that are applicable within the buildings of the Company and its Subsidiaries where employees are working.
Xx. XXXXXXX explicitly allows the Company to take the necessary measures in his name in the event any problem should arise in this respect.
7. Xx. XXXXXXX shall report on his activities at the times determined by the Board of Directors, and any time either party to this Agreement considers it necessary for the proper execution of either parties’ obligations arising from this Agreement. Xx. XXXXXXX will however, not be asked to give account of the work hours, work methods and/or work organisation.
Article 3 — Management fees
1. The Company will pay Xx. XXXXXXX for the duration of this Agreement a fixed annual management fee (hereinafter “Management Fee”). This fee shall amount to 100.000,00 EUR gross, payable in 12 monthly instalments. In case of an incomplete month or year, said fee will be paid pro rata temporis.
2. Xx. XXXXXXX shall be solely responsible for his good legal standing, social security status (as a self-employed individual) and any social security contributions due from such status, and tax status under the laws of applicable jurisdictions. Xx. XXXXXXX acknowledges that the Company shall be paying the Management Fee and the amounts under Articles 4 and 5 after deduction of Belgian withholding tax, if any, and any other applicable deductions.
3. The parties may from time to time decide to modify the Management Fee in mutual agreement, it being understood that such adjustment will need to be endorsed by the competent corporate body of the Company.
Article 4 — Sign-on bonus
In June 2004, the Company paid Xx. XXXXXXX a sign-on bonus of 33.333,00 EUR gross.
Article 5 — Benefits
1. Xx. XXXXXXX shall be entitled to the following benefits, to be provided by the Company or, at the Company’s election, its Subsidiaries, during the term of this Agreement:
(a) group medical insurance adopted by the Company for participation by Xx. XXXXXXX subject to the terms and conditions of such plan, it being understood that during 2005 such medical insurance shall be provided in the form of a
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German-based plan with benefits reasonably equivalent to those under the medical insurance policy carried by Xx. XXXXXXX and his family during the year 2004; and
(b) during 2004, reimbursement for reasonable premium payments made by Xx. XXXXXXX to his current medical insurance provider.
In addition, during the term of this Agreement, Xx. XXXXXXX shall be entitled to participate in all of the Company’s benefit programs for which directors of the Company are generally eligible.
2. The Company will lease an automobile, the aggregate payments for which shall not exceed 25.000,00 EUR annually, and provide it to Xx. XXXXXXX for business use in accordance with Company policy.
3. For the period during which Xx. XXXXXXX’x place of work is Oudenaarde, Belgium, the Company will:
(a) rent an apartment, the aggregate payments for which shall not exceed 25.000,00 EUR annually, and allow Xx. XXXXXXX to reside in it in accordance with Company policy; and
(b) pay Xx. XXXXXXX’x reasonable professional travel costs to and from the Company’s offices in Oudenaarde, Belgium, in accordance with the Company policy with respect to reimbursement of expenses, in an aggregate amount not to exceed 25.000,00 EUR annually.
4. Xx. XXXXXXX agrees to work in good faith with the Company and its Subsidiaries to minimize expenses relating to the forgoing benefits.
Article 6 — Special tax status for expatriates
1. The Company will file a request on behalf of Xx. XXXXXXX in order to obtain the special tax status for expatriates.
2. Xx. XXXXXXX will not undertake any action that could jeopardize the approval or continued application of the special tax status for expatriates or reduce the benefits for the Company.
3. Xx. XXXXXXX shall keep all documents related to his professional travel to a destination outside Belgium, such as boarding passes, train tickets, visa stubs, etc., and forward these upon request to the Company or its designated tax advisors.
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Article 7 — Termination - Disruption
1. Subject to any other agreements between the parties hereto, this Agreement is concluded for an indefinite period of time and commences on 25 June 2004.
In the event, Xx. XXXXXXX wishes to resign or terminate this Agreement, he will promptly inform the Company. It is explicitly agreed, that Xx. XXXXXXX will have to serve in any event, except as otherwise agreed in writing between parties, a notice period of 45 days in order to ensure the continuity of the Company’s activities and the handover of his responsibilities to his successor. The Company may terminate this Agreement at any time by giving a notice period of 45 days.
2. Notwithstanding anything to the contrary, upon termination of this Agreement by the Company or Xx. XXXXXXX, Xx. XXXXXXX shall not be entitled to any indemnity or severance payment or any additional amount by way of Management Fees.
3. The Company may terminate this Agreement with immediate effect in the event (i) that Xx. XXXXXXX violates any provision of this Agreement, (ii) of serious misconduct, gross negligence, gross or deliberate fault or deceit committed by Xx. XXXXXXX, or (iii) Xx. XXXXXXX becomes prohibited from holding office as managing director.
4. Upon revocation of Xx. XXXXXXX’x mandate by the Company or resignation of Xx. XXXXXXX as managing director of the Company, Xx. XXXXXXX will promptly resign from the board or from any other corporate office in any Subsidiary.
Article 8 — Death and Illness
1. If Xx. XXXXXXX is unable to perform the day-to-day management due to physical or mental disability during a continuous period of at least 90 days, the Company shall have the right to terminate this Agreement with immediate effect and without indemnity or severance payment.
2. Xx. XXXXXXX has the obligation to produce, in the event of physical or mental disability, medical certificates and shall comply with such other requirements as the Company may reasonably impose.
3. This Agreement shall terminate automatically upon Xx. XXXXXXX’x death. In this event, the Agreement is terminated with immediate effect and without indemnity and severance payment.
Article 9 — Confidentiality
1. Unless otherwise required by law or judicial process, Xx. XXXXXXX shall keep confidential all Confidential Information known to Xx. XXXXXXX concerning the Company or its affiliated companies and their respective businesses during the term of this Agreement and for the shorter of three (3) years following the termination of this Agreement or until such information is publicly disclosed by the Company or otherwise becomes publicly disclosed other than through the actions of Xx. XXXXXXX;
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provided that Xx. XXXXXXX shall provide notice to the Company in advance of any disclosure required by law or judicial process in a timely manner to permit the Company to oppose such compelled disclosure.
2. For purposes of this Agreement, “Confidential Information” shall mean proprietary information of the Company and its affiliated companies of any nature and in any form or information about the Company’s or its affiliated companies’ business, operations, strategy, personnel or plans which is not made publicly available by the Company or its affiliated companies, except for information independently developed by Xx. XXXXXXX without any use of Confidential Information or which was at the time of disclosure to Xx. XXXXXXX part of the public domain or thereafter becomes generally part of the public domain other than through Xx. XXXXXXX’x actions, or which Xx. XXXXXXX can demonstrate was lawfully in his possession prior to disclosure to Xx. XXXXXXX by the Company or was lawfully received by Xx. XXXXXXX after disclosure from a third party.
3. Upon termination of the engagement of Xx. XXXXXXX for any reason, Xx. XXXXXXX shall return all property belonging to the Company or its Subsidiaries as applicable, including any and all Confidential Information in the possession of Xx. XXXXXXX or under his control.
Article 10 - Enforceability
Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any action in any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
Article 11 - Jurisdiction
The courts of the registered office of the Company have exclusive authority in relation to every dispute connected to the interpretation, the execution and/or the termination of this Agreement. All issues and questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by, and construed in accordance with, the laws of Belgium.
Article 12 - Entire agreement
This Agreement embodies the complete agreement and understanding among the parties and supersedes and pre-empts any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.
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Article 13 - Notices
All notices or other correspondence arising under this Agreement shall be duly delivered or sent by registered post to :
Notices to Xx. XXXXXXX:
c/o Xxxxxxxx Xxxxxxxx
Studio Dott. Xxxxx Xxxxxxxxxx
Xxx Xxxxxxxx, 0
00000 Xxxxx
XXXXX
Facsimile: x00 0000000000
With a copy, which shall not constitute notice, to:
Xxxxx Xxxxxx
0000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxx, Xxxxxxx 00000
UNITED STATES OF AMERICA
Facsimile: x0 (000) 000-0000
Notices to the Company:
SAMSONITE EUROPE NV
Xxxxxxxxx 00
0000 Xxxxxxxxxx
XXXXXXX
Facsimile: +32/55/300.970
Attention: Xxxxxxxx Xxxxxxx
With a copy, which shall not constitute notice, to:
XXXXXXXX & XXXXX INTERNATIONAL LLP
Tower 42
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
XXXXXX XXXXXXX
Facsimile: x00 00 0000 0000
Attention: Xxxxx X. Learner
Xxxxx Xxxxxxx Xxxx
Or such other person and address as the parties shall notify the other in writing or vice versa from time to time.
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Made in two originals in Oudenaarde to be effective as of . Both parties acknowledge receipt of an original copy duly signed by both parties.
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/s/ Xxxxxxxx Xxxxxxx |
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XXXXXXXX XXXXXXX |
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(“read and approved”) |
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SAMSONITE EUROPE N.V. |
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(“read and approved”) |
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By: |
/s/ Xxxxxxx X. Xxxxx |
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XXXXXXX X. XXXXX, Director |
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By: |
/s/ Xxxx Xxxxxx |
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XXXX XXXXXX, Director |
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