TERMINATION AND SETTLEMENT AGREEMENT
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BY AND BETWEEN :
1. XXXXXXX EUROPE BVBA, with registered office at 1930 Xxxxxxxx,
Xxxxxxxxxxxxx 0,
represented by Mr. Xxxx Xxxxxx, Special proxyholder,
hereinafter referred to as "the Company"
2 XXXXXXX ATLANTIC INC,
represented by Mr. Xxxx Xxxxxx, Special proxyholder,
3 XXXXXXX WORKS INC., a company existing under the laws of Connecticut,
registered office at 0000 Xxxxxxx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxxx, XXX
represented by Mr. Xxxx Xxxxxx, Special proxyholder,
both hereinafter referred to as "Stanley"
AND
4. MR. STEF X.X. XXXXXXXXXX, residing at The Netherlands, Xxxxxxxxx 00,
0000 XX Xxxxxxxxx,
hereinafter referred to as "the Director"
IT IS WITNESSETH :
WHEREAS the Company and the Director entered into a Director's Agreement dated
June 29, 1998, pursuant to which the Director rendered certain management
services to the Stanley group of companies in Europe, under the title "President
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Xxxxxxx Europe Middle East and Africa", and formally accepted the mandate of
"zaakvoerder" of the Company, starting September 1, 1998 (the "Director's
Agreement");
WHEREAS the Company and the Director entered also into a non-competition
agreement dated June 29, 1998, pursuant to which the Director undertook not to
compete for a period of 14 months following the termination of the Director's
Agreement (the "Non-competition Agreement");
WHEREAS Xxxxxxx Atlantic Inc. co-signed both the Director's Agreement and the
Non-competition Agreement as a guarantor (bij wijze van sterkmaking) for the
Company, then still in formation;
WHEREAS Xxxxxxx Works Inc. signed, on June 29, 1998 a guarantee letter
guaranteeing the obligations of the Company towards the Director (the
"Guarantee");
WHEREAS Xxxxxxx Works Inc. and the Director entered into an agreement dated June
29, 1998, pursuant to which Xxxxxxx Works Inc. awarded certain stock options to
the Director, exercisable one year and five years after the granting thereof
("Stock-Option Agreement");
WHEREAS the Company and the Director entered into a loan agreement dated August
7, 1998, pursuant to which the Company lent an amount of BEF 7,955,000 to the
Director in connection with the Director's house purchase free of interest for a
fixed term of 10 years (the "Loan Agreement);
WHEREAS the Company and the Director signed a non-dated agreement pursuant to
which the loan under the Loan Agreement can be deemed reimbursed under certain
circumstances (Redemption Agreement);
WHEREAS the Company and the Director have agreed to terminate by mutual consent
all of their relationships and all agreements existing between them, as of the
date and under the terms and conditions set forth hereunder;
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IT HAS BEEN AGREED UPON AS FOLLOWS :
ARTICLE 1 : TERMINATION OF AGREEMENTS, APPOINTMENTS AND OTHER RELATIONSHIPS
1.1. The Company and the Director hereby confirm that they have agreed to
terminate, upon the request of the Company, all their relationships and
all of the agreements existing between them, in whatever capacity, in
writing or verbal, including but not limited to the Director's
Agreement, the Non-competition Agreement, the Stock-Option Agreement,
the Loan Agreement, the Redemption Agreement and the Guarantee
(hereafter the "Agreements") relating to the appointment as Director
and the performance of other services in whatever capacity, if any,
with effect as of September 29, 2000 (the "Effective Termination Date")
and that neither party owes any termination indemnity to the other
party as a result of the termination of such relationships and
Agreements. As of the Effective Termination Date, neither party will
have any obligations or enjoy any rights under any of the Agreements
existing between them, with the exception of this agreement.
1.2. The Director resigns as of the Effective Termination Date (and this
agreement serves as the relevant resignation letter) from all of his
corporate functions and mandates with the Company, Stanley or any
company of the Stanley group of companies, including but not limited to
his mandate as manager ("zaakvoerder") of the Company and undertakes to
fully co-operate in executing all documents and accomplish all
formalities required to that effect. Such resignations will not create
any right to any indemnity other than as set forth in this agreement.
1.3. At the first meeting of the shareholders of the Company, the Company
and Stanley shall see to it (bij wijze van sterkmaking) that the
resignation by the Director from his functions and mandates is accepted
as of the Effective Termination Date and that at the latest during the
first shareholders' meeting, the discharge of the Director shall be
given.
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ARTICLE 2 : COMPENSATION
2.1 The Company undertakes to pay, in the framework of this agreement and
all as in accordance with and pursuant to the terms and conditions of
the Director's Agreement and the Non-competition Agreement, the
following amounts to the Director no later than October 15, 2000:
(1) the base remuneration for the month of September 2000, subject
to the legally imposed withholdings. The Director recognizes
that he already received the payment of this amount;
(2) a pro-rated bonus payment of BEF 6,900,000, subject to the
legally imposed withholdings;
(3) a gross lump sum compensatory indemnity pursuant to the
provisions of the Non-competition Agreement of BEF 33,541,666,
subject to the legally imposed withholdings.
2.2 The amounts set forth in article 2.1 have been agreed upon, and will be
paid, on the condition that the Company will have no further liability
whatsoever vis-a-vis any person or authority as a result of or in
connection with the Agreements and/or the termination thereof.
2.3 Should the Company or Stanley be, at any time in the future, held
liable for the payment of any amount other than the amounts set forth
in this agreement to any person(s), company or authority, as a result
of or in connection with the termination of the Agreements, then the
parties expressly agree that the Director shall indemnify and hold the
Company and Stanley harmless and that furthermore the indemnity set
forth in article 2.1 shall be automatically and retroactively reduced
with the amount(s) payable and effectively paid by the Company or
Stanley to such person(s), company or authority and the Director shall
be required to immediately return, and the Company or Stanley shall be
entitled to immediately receive from the Director, any amount(s) for
which the Company or Stanley would have been liable and with which the
indemnity shall have been so reduced.
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2.4 The Director agrees with the amounts to be paid to him pursuant to
article 2.1, with the immediate termination of the Agreements, with the
calculation basis of the gross lump sum compensatory indemnity pursuant
to the Non-competition Agreement and agrees that these amounts cover
all indemnities due to the Director under all Agreements,
relationships, mandates and functions, including any other agreements,
relationships, mandates and functions with the Company, Stanley or any
company of the Stanley group of companies.
2.5 The Director further agrees that the amounts to be paid to him pursuant
to article 2.1 are all-inclusive, i.e. inclusive of all other
remuneration, payments, manager compensations, premiums, bonuses,
incentive payments, performance awards or similar advantages that the
Company or Stanley or any company of the Stanley group of companies owe
or may owe to the Director relating to any aspect of the relationship
between them or the termination thereof.
2.6 The Director shall report any outstanding expenses which are due by the
Company no later than October 31, 2000.
2.7 The Company will provide a tax consultant to assist to the preparation
of the Belgian and Dutch annual tax return for income earned under the
Director's Agreement in respect of the period of the Director's mandate
until the Effective Termination Date.
ARTICLE 3 : CONFIDENTIALITY, COMPANY BELONGINGS, NON SOLICITATION
3.1 The Director shall return, no later than within 3 days following the
Effective Termination Date, all documents, designs, formulae,
specifications, drawings, notes, reports, minutes, files, memoranda or
whatever other type of document (even if not printed and existing in
software format only), that he has received or drafted or that have
otherwise become in his possession and that regard or is the property
of the Company, Stanley or the Stanley group of companies, their
activities, customers, suppliers, personnel and so forth, whether or
not confidential, to the Company, without keeping or making copies
thereof. The Director shall also return to the Company his mobile
phones, faxes and any other Company property.
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3.2 The Director undertakes and agrees:
(1) to maintain in strictest confidence and not to disclose or
appropriate for his own use or for the use of others, directly
or indirectly (i) any confidential or proprietary information
of knowledge of the Company, Stanley or any company of the
Stanley group of companies, including matters of a technical
nature such as know-how, studies and research, and matters of
a business nature such as information about costs, profits,
sales, marketing or business plans (existing or potential)
customer lists (including members and issuers), customer
requirements, internally developed methods of customer
solicitation, the identity of and other facts relating to
existing or prospective customers, arrangements with customers
and other data not available to the public, (ii) any
information regarding or relating to the services performed by
the Director and/or the manner and circumstances in which
these services were conducted under all Agreements,
relationships, mandates and functions, and (iii) the terms and
conditions of this agreement including other agreements,
relationships, mandates and functions and the termination of
the Agreements.
(2) to refrain at all times from any acts of unfair competition
against the Company or Stanley or the Stanley group of
companies or complicity to such acts.
(3) to continue to comply, including following the termination,
with the provisions of article 8.2 and 9 of the Director's
Agreement.
3.3 Any violation of the provisions of this article 3 shall, in addition to
any other legal remedies available to the Company or Stanley or the
Stanley group of companies, result in an obligation of the Director to
immediately return, and an entitlement of the Company or Stanley or the
Stanley group of companies to immediately receive, any payment made to
the Director by the Company under this agreement, the other provisions
of this agreement however remaining in full force and effect.
ARTICLE 4
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4.1 The Director agrees and undertakes to reasonably co-operate with the
Company or Stanley or the Stanley group of companies, in all cases
where there would be a need for transitional support, also after the
Effective Termination Date.
4.2 The Director further agrees to co-operate in good faith with the
Company or Stanley or the Stanley group of companies, and to defend the
interests of the Company or Stanley of the Stanley group of companies,
as a witness or in any other capacity in case of a court case,
arbitration trial or any other proceeding or negotiation which is
directly or indirectly related to his activities as director.
4.3 The Director shall at all times, including after the Effective
Termination Date, behave correctly and professionally towards the
Company, Stanley and any company of the Stanley group of companies and
their customers, suppliers, employees, representatives and business
contacts, and shall at no time, including after the Effective
Termination Date, criticize publicly or in any other way express
adverse publicity regarding the Company, Stanley, his relationship to
the Company and Stanley, the termination thereof or the terms of this
agreement.
4.4 The Director further agrees and covenants not to make or take, directly
or indirectly, any action, attempt, statement or any other step, which
could have the effect of prejudicing the business or reputation of the
Company or Stanley or the Stanley group of companies. In this respect,
the Director explicitly agrees to refrain from any statement or other
form of communication to the press or to any third party regarding the
performance of the Agreements and/or the circumstances that have led to
the termination of the Agreements.
4.5 Any violation of the provisions of article 4 shall, in addition to any
other legal remedies available to the Company or Stanley or the xxxxxxx
group of companies, result in an obligation of the Director to
immediately return, and an entitlement of the Company or Stanley or the
Stanley group of companies to immediately receive, any payment made to
the Director by the Company under this agreement, the other provisions
of this agreement however remaining in full force and effect.
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ARTICLE 5 : NON-COMPETITION
5.1 In consideration for the payment by the Company of the amount set forth
in article 2.1 (3), and in accordance with and pursuant to the terms
and conditions of the Non-competition Agreement, the Director
undertakes, for a period of fourteen months following the Effective
Termination Date in Europe, the Middle East or Africa (i.e. the
territory where the Director has been active for the Stanley group of
companies), not to be active, in an independent, dependent or other
form, in the tools and hardware industry in which the Company, Stanley
or any company of the Stanley group of companies is active.
5.2 Any violation of the provisions of article 5.1 shall, in addition to
any other legal remedies available to the Company, Stanley or any
company of the Stanley group of companies, result in an obligation of
the Director to immediately return, and an entitlement of the Company,
Stanley or any company of the Stanley group of companies to immediately
receive, the payment made to the Director by the Company of the amount
set forth in article 2.1(3), the other provisions of this agreement
however remaining in full force and effect.
ARTICLE 6 : STOCK OPTIONS, VESTING, EXERCISE PERIOD
6.1 Pursuant to the provisions of the Stock-Option Agreement, all stock
options that have been granted to the Director and that are vested at
the Effective Termination Date, have become immediately exercisable and
will remain exercisable until two months following the Effective
Termination Date. All options not yet granted to the Director, or
granted but not vested on the Effective Termination Date, will not be
exercisable.
6.2 All Belgian and/or foreign personal tax and personal social security
contributions, which may arise at the occasion of the vesting or the
exercise of the stock options, will be borne by the Director who shall,
at any time in the future, indemnify and hold the Company harmless, for
any such amounts for which the Company would be held liable.
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ARTICLE 7 : LOAN AND REDEMPTION AGREEMENT
7.1 In accordance with and pursuant to the terms and conditions of the Loan
Agreement and the Redemption Agreement, the loan in the amount of BEF
7,955,000 (granted to the Director on August 7, 1998 at no interest)
will be deemed to have been fully reimbursed by the Director on the
Effective Termination Date.
7.2 All Belgian and/or foreign personal tax and personal social security
contributions, which may arise at the occasion of the loan or the early
redemption thereof, will be borne by the Director who shall, at any
time in the future, indemnify and hold the Company harmless, for any
such amounts for which the Company would be held liable.
ARTICLE 8 : WAIVER
The Director accepts the amounts to which he is entitled on the basis of this
agreement as full and final settlement of all accounts, all Agreements, all
arrangements and all relationships between the Director on the one hand and the
Company, Stanley and any and all companies of the Stanley group of companies on
the other hand, in the meaning of article 2044 a.f. of the Belgian Civil Code.
The Director declares expressly that, subject to the performance of this
agreement, neither the Company nor Stanley nor any company of the Stanley group
of companies will have any further obligations vis-a-vis him and that he has no
further rights or claims vis-a-vis the Company or Stanley or any company of the
Stanley group of companies on the basis of the relationships or any of the
Agreements, arrangements or documents existing between them and the Director in
whatever capacity and/or the termination thereof.
The Director waives any potential or actual cause of action which he has or may
have relating to the performance and/or the termination of the Agreements,
whether known or unknown, fixed or contingent, and for any reason whatsoever,
including, but not limited to any insurance coverage, benefits, premiums,
termination indemnity, departure allowance, or any other advantage, payment,
incentive, accrued rights or similar advantages that are not
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explicitly set forth in this agreement or any other provision of national,
regional or local law or regulation.
Any lawsuit filed on behalf of the Director in violation of this agreement,
shall automatically constitute a breach of the agreement, and in addition to any
other legal remedies available to the Company, Stanley or any company of the
Stanley group of companies (including the right to argue that any claim raised
by the Director should be dismissed on the basis of this agreement), the
Director shall be required to immediately return, and the Company, Stanley or
any company of the Stanley group of companies shall be entitled to immediately
receive, any payment made to the Director by the Company under this agreement,
the other provisions of this agreement however remaining in full force and
effect.
The Director knowingly and on an informed basis renounces to invoke any factual
or legal error or any omission whatsoever pertaining to the existence and extent
of his rights waived in this agreement.
ARTICLE 9 : INVALIDITY OF A CLAUSE OF THIS AGREEMENT
If any or more of the provisions of this agreement shall be held to be invalid,
illegal or unenforceable, the remaining provisions shall not be affected or
impaired and the relevant provision shall be restricted and/or modified only to
such extent to make it a valid, legal and enforceable provision.
ARTICLE 10 : PRIORITY
This agreement supersedes any and all agreements of a prior date, covering the
same subject, whether oral or in writing, between the parties.
ARTICLE 11 : GOVERNING LAW AND COMPETENT JURISDICTION
This agreement is governed by Belgian law and any dispute in connection
therewith shall be subjected to arbitration, in English, before an arbitration
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tribunal consisting of one arbitrator, appointed and working in accordance with
Belgian law, without prejudice to the right for either party to initiate summary
proceeding before a competent Court.
Made at Zaventem, on October ....., 2000, in four original copies.
Each party acknowledges receipt of a duly initialized and signed original.
The Director The Company
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Mr. G.H. Xxxx Xxxxxxxxxx Mr. Xxxx Xxxxxx,
Special proxyholder
Xxxxxxx Atlantic Inc Xxxxxxx Works Inc
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Mr. Xxxx Xxxxxx, Mr. Xxxx Xxxxxx,
Special proxyholder Special proxyholder
