EXHIBIT 4.(a)(xx)
▇▇▇▇▇ TECHNOLOGY NV.
Kaya ▇▇▇▇▇ ▇▇▇▇ 1-L,
Curacao,
The Netherlands Antilles
27th December, 2001.
Dear ▇▇ ▇▇▇▇▇,
EMPLOYMENT TERMINATION AGREEMENT BETWEEN ▇▇▇▇▇▇ ▇ ▇▇▇▇▇ AND
▇▇▇▇▇ TECHNOLOGY NV (THE "COMPANY")
I refer to the termination of your employment by the Company (or any Group
Company if applicable) by mutual consent effective October 10 2001 (the
"Termination Date").
The following terms have been agreed between us:
1. DEFINITIONS
In this letter:
Parent Company means ▇▇▇▇▇ Networks NV
Group Company means the Parent Company and any
Subsidiary and Associated company/ies
of the Parent Company from time to time
excluding the Company;
Associated company means as defined by United States
Generally Accepted Accounting
Principals ("GAAP");
Subsidiary company means as defined by United States GAAP.
2. PRIVATE MEDICAL INSURANCE
The Company will cease to provide you with any cover under its Group
Private Health Insurance Scheme from the Termination Date.
3. LIFE INSURANCE
The Company will cease to provide you with any cover under its Group
Life Insurance and Permanent Health Insurance schemes from the
Termination Date.
4. CONSULTANCY AGREEMENT
The Company will, or will procure that a Group Company shall, at the
conclusion of this agreement enter into a consultancy agreement with
you, effective October 10, 2001, which is to remain in effect through
October 9, 2003, and which will not be cancellable at the option of the
Company except for reason of gross misconduct. The Consultancy
Agreement will provide for your availability to provide consulting
services to the Company or other Group Companies from time-to-time in
relation to knowledge of the past activities of Group Companies and the
strategic development of Group Companies as mutually agreed for a
monthly fee of $10,000. For the avoidance of doubt you will not be
provided with any benefits or compensation for these services (other
than the monthly fee plus any allowable expenses incurred as specified
in the Consultancy Agreement) and your relationship with the Company
will be that of an independent contractor and not as an employee or
agent of the Company or any other Group Company. You will be
responsible for direct payment of any taxes on the compensation paid to
you under the Consultancy Agreement.
You are not authorized to bind the Company or make any representations
on its behalf in any matter, except as set forth in the Consultancy
Agreement or in your capacity as Supervisory Director of the Parent
Company.
This does not affect any appointment to the role of Supervisory
director or (if applicable) to Designated Supervisory director of the
Parent Company and the additional remuneration you may receive for
these roles or for any other fees you may receive as director of any
Associated company.
5. ▇▇▇▇▇ NETWORKS NV 1993 STOCK PLAN
Under the terms of the ▇▇▇▇▇ Networks NV 1993 Stock Plan, vesting of
options previously granted to you will cease with effect from the date
of your termination. You will have a right to exercise the vested
portion of any options previously granted to you for a period of 90
days from the date of termination. This does not affect any options
granted to you in your new role as Supervisory Board director and
proposed new role of Designated Supervisory director (if so appointed)
of the Parent Company.
6. LEGAL PROCEEDINGS
You will, at the request of the Company, provide the Company and any
other Group Company with such assistance as it may reasonably require
in the conduct of legal proceedings or any inquiry or investigation in
respect of which the Company or its legal advisers believe you may be
able to provide assistance. In such a situation the Company will
reimburse you for your time and expenses involved.
7. INDEPENDENT LEGAL ADVICE
By countersigning this letter, you warrant that you have received
independent legal advice as to the terms and effect of this letter and
the fact that you will be precluded from bringing a claim of unfair
dismissal or for a statutory redundancy payment or a claim of sex, race
or disability discrimination or in respect of unauthorized deductions
from wages.
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You represent and warrant that you have informed the Company of all and
any contractual, statutory or any other claim that you have or may have
against the Company or any other Group Company which arises from your
employment or its termination or your role as Managing Director of the
Management Board of the Parent Company and you agree that this
agreement is entered into by you in relation to such claims.
8. COMPENSATION
By way of compensation for loss of office and the termination of your
employment (and subject to your fulfillment of the conditions and
obligations set out in paragraph 9) the Company agrees to pay or to
procure that a Group Company pay to you the sum of $580,000. Any
entitlement to bonus payments have already been paid or are included in
the Compensation Payment and no additional sum is due to you for bonus
payments. The Compensation Payment will be made to you in 24 monthly
installments of $24,166 on or around the 28th day of each month,
commencing on October 28th, 2001 (and backdated as necessary).
In addition you will receive a payment of $134,880 in lieu of notice
and this will be paid to you in 3 monthly installments on or around the
28th day of each month, commencing on October 28th 2001 (and backdated
as necessary).
All payments specified under this clause 8 are recognised as debts
incurred by the company to you as of the date of this Agreement, and
the payments by installment are in the form of repayment of the debt
(agreed by you in order to spread the cash flow impact on the Company).
All such payments may be made by the Company directly or by a Group
Company if the Company so elects, in its entire discretion and the
Parent Company agrees to guarantee the payment of such sums in the
event the Company fails to honour its payment obligations.
9. YOUR OBLIGATIONS
In consideration of the Company agreeing to make the Compensation
Payment referred to in paragraph 8 by way of compensation for loss of
office and in connection with the termination of your employment, you
represent, warrant and undertake to the Company that:
9.1 subject to requirements for your role as Supervisory Director of the
Parent Company or in conjunction with the Consultancy Agreement, you
have returned in good condition and without modification all books,
documents, correspondence, computers and computer discs, papers,
materials, lease car, mobile telephone, credit or charge cards, keys
and security access cards, including all copies thereof, and all other
property of or relating to the business or affairs of the Company or
any other Group Company or any officer, employee, customer, supplier or
agent of the Company or any other Group Company, its or their
customers, clients or suppliers, to the Company's premises.
9.2 you have committed no breach of duty (including fiduciary duty) to the
Company or any other Group Company and that you are not aware of any
such breach by any other director or employee of the Company or any
other Group Company.
9.3 you are solely responsible for the payment of any tax of any nature and
any liability to national insurance contributions or other payroll
taxes (whether payable in the
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Netherlands or elsewhere) arising by reason of any payment or the
provision of any other benefit set out in this letter (save for any tax
deducted by the Company from the payments specified in paragraphs 4 and
8 for which the Company shall account to the relevant tax authority).
You will fully and effectively indemnify and keep indemnified every
Group Company against all liabilities to taxation (including, without
limitation, any liability resulting from a failure to deduct tax) and
national insurance contributions (including any reasonable costs and
expenses) which any such company may incur by reason of such payment or
the provision of such benefit.
9.4 there is no fact or circumstance under which any payment is due or
could become due from the Company or any other Group Company to you
other than under the terms of this letter, the terms of your proposed
appointment as a Supervisory Director or as a Designated Supervisory
Board member (if applicable) of the Parent Company or under the
Consultancy Agreement or by reason of your potential shareholding in
the Parent Company.
9.5 you will not make any statement to any third party regarding your
employment or its termination or the business affairs of the Company or
any other Group Company their suppliers, customers, employees, officers
or agents except as required by law or by any regulatory body. In the
event that disclosure is required by law or regulatory body you shall
provide written notice of the proposed disclosure to the Company at
least two working days before you make such disclosure.
9.6 you shall not (save as may be required by law or by any regulatory body
or save as such information may be in the public domain or save to your
own professional advisers) divulge to any person whatever or otherwise
make use and shall use your reasonable endeavours to prevent the
divulging or making use of any trade secret or any confidential
information concerning the employees or officers or business or
finances of the Company or any of its dealings, transactions or affairs
or any trade or secret process or any such confidential information
concerning any other Group Company or any of their employees, officers,
suppliers, agents, distributors or customers; If disclosure is required
by law or any regulatory body you will comply with the obligations in
clause 9.5 above.
9.7 you will not make any derogatory or critical statements or comments
(whether written or oral) concerning the Company or any other Group
Company or any of its or their directors, officers, employees,
shareholders or investors (and the Company agrees that it will not make
any such derogatory statements about you).
9.8 you will not assist in any manner whatsoever (save as required by order
of a court of competent jurisdiction) any person, firm or company in
bringing any claim against the Company (or any other Affiliate of the
Company) or commencing or continuing any legal proceedings against such
company that relates to an event that has already occurred and of which
you are currently aware.
9.9 you will not (directly or indirectly) on your own account or on behalf
of or in conjunction with any person for a period of twelve months
after the Termination Date:
a) be concerned with any business which directly competes with
or, at the commencement of your involvement with such
business, plans to directly compete with the business carried
on at the Termination Date by any Group Company;
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b) deal with or canvass or solicit business from, for goods of a
similar type to those being manufactured or dealt in by the
Company at the Termination Date, or any person who has been a
customer of the Company and with whom you were actively
involved in the course of your employment;
c) induce or attempt to induce any Group Company employee who
directly reported to you, any manager level employee, any
director level employee, any Vice President, or any
salesperson or development engineer of any Group Company who
is engaged in any business or activity carried on by any Group
Company at the Termination Date, to leave the employment of
the Company (whether or not this would be a breach of contract
by the employee);
You acknowledge that the provisions of 9.9 are no more
extensive than are reasonable to protect any Group Company. In
this clause "person" includes any company, firm, organisation
or other entity. Each of the restrictions in each paragraph or
sub-clause above shall be enforceable independently of each of
the others and its validity shall not be affected if any of
the others is invalid. If any of those restrictions is void
but would be valid if some part of the restriction were
deleted the restriction in question shall apply with such
modification as may be necessary to make it valid.
You also note that the Consultancy Agreement, to be entered
into pursuant to clause 4 above, may contain similar
restrictive covenants at least for the period of the
Consultancy Agreement.
9.10 In the event that you commit any breach of this paragraph 9 you agree
to immediately repay to the Company upon demand as a debt all sums
which the Company has paid to you pursuant to paragraph 8 which shall
include an amount in respect of sums accounted for by the Company to
the relevant authorities in respect of tax and National Insurance
contributions. For the avoidance of doubt if you commit any such
breach, the Company shall have no further obligation or liability to
make any further payments to you, pursuant to paragraph 8.
10. THE COMPANY'S OBLIGATIONS
In consideration of the obligations undertaken by you under this Agreement the
Company agrees and the Parent Company hereby guarantees the obligations of the
Company under this Agreement that:-
10.1 it will, at your request, provide you with such assistance as you may
reasonably require, in the conduct of legal proceedings or any inquiry
or investigation brought against you in respect of your actions or
omissions whilst acting in your capacity as employee, officer, Managing
Director, CEO or Chairman of the board of the Company or of the Parent
Company or of any Group Company (for the purposes of this clause such
capacity shall be referred to as your capacity as "Employee with the
Company");
10.2 it has informed you of all and any contractual, statutory or any other
claim that it has or may have against you which arises from you being
an Employee of the Company or from the termination of your role as
Employee of the Company;
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10.3 you will continue to be covered, to the extent permitted by the
policies, under all and any directors & officers' insurance that the
Company or any Group Company has or had in place during the period you
were an Employee of the Company for acts or omissions that you did as
an Employee of the Company;
10.4 there is no fact or circumstance, that the Company is currently aware
of, under which any payment is due or could become due from you to the
Company or any Group Company;
10.5 it has no claim that the Company is currently aware of against you in
your capacity as Employee of the Company, or otherwise, and
unconditionally discharges you from your responsibilities as employee
except for your obligation to assign any intellectual property
developed by you during your employment to the Company and your
continuing obligations under this agreement which include obligations
related to non-disclosure of company information The Company notes that
you are discharged from your liabilities as managing director the
Parent Company to the extent that the matter was apparent to the
shareholders from the annual accounts that were adopted from time to
time by the general meeting of shareholders, subject to certain
exceptions in the case of bankruptcy;
10.6 the indemnification agreement previously signed by the Parent Company
and yourself continues in force;
10.7 it will not make any statement to any third party regarding your
employment or its termination or your business affairs except as
required by law or by any regulatory body. In the event that disclosure
is required by law or regulatory body the Company shall provide you
with written notice of the proposed disclosure at least two working
days before it makes such disclosure;
10.8 it shall not (save as may be required by law or by any regulatory body
or save as such information may be in the public domain or save to its
own professional advisers) divulge to any person whatever or otherwise
make use and shall use its reasonable endeavours to prevent the
divulging or making use of, any confidential information concerning you
or your finances or any of your dealings, transactions or affairs If
disclosure is required by law or any regulatory body the Company will
comply with the obligations in clause 10.7 above.
11. SETTLEMENT
You accept the terms of this letter and any sum paid under it, in full
and final settlement of all present and future claims or rights of
action arising in all jurisdictions that you have or may have against
the Company or any other Group Company or any employees or officers or
agents of those companies, relating to your employment or the holding
of any office, the termination of your employment or relating to your
loss of any office or any other matter arising including any common law
or statutory claims that you have or may have against the Company and
you will refrain from instituting or continuing and will immediately
withdraw unconditionally any legal proceedings or complaint before or
to any employment tribunal, or Dutch equivalent, in relation to any
such matters as are referred to in this paragraph.
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This letter, and any agreement concluded in relation to it, is to be construed
in accordance with and subject to Dutch Law. The proposals contained in it are
made without any admission of liability.
Yours sincerely
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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For and on behalf of
▇▇▇▇▇ Technology NV
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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For and on behalf of
▇▇▇▇▇ Networks NV
I hereby agree with the terms set out in the letter of which this is a
duplicate.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇
Date: 27 December 2001.
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