Sample Business Contracts


Executive Management Agreement - Samsonite Corp. and Luc Van Nevel

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EXECUTIVE MANAGEMENT AGREEMENT

        EXECUTIVE MANAGEMENT AGREEMENT (this "Agreement"), effective as of February 1, 2002, (the "Effective Date"), by and between SAMSONITE CORPORATION, a Delaware corporation (the "Company"), and LUC VAN NEVEL, a resident of Belgium (the "Executive").


W I T N E S S E T H:

        WHEREAS, the Company desires to retain the services of the Executive and to enter into this Agreement as of the Effective Date.

        WHEREAS, the Executive is willing to serve the Company on the terms and conditions herein provided.

        NOW, THEREFORE, in consideration of the foregoing and of the premises and covenants herein contained, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

        1.    EMPLOYMENT

        The Company agrees to employ the Executive and the Executive agrees to serve the Company on the terms and conditions set forth herein.

        2.    TERM

        The term of this Agreement (the "Term") shall begin on February 1, 2002 and shall continue for successive one-year periods (each a "Contact Year") ending on January 31, 2003 and January 31 of each year thereafter, provided that this Agreement shall automatically terminate on February 1, 2007 without notice and without further action to be taken by any party. The Executive's employment hereunder shall terminate at the end of the Term, unless sooner terminated pursuant to Section 5.

        3.    POSITION AND DUTIES

            (a)  The Executive shall serve as President and Chief Executive Officer (the "CEO") of the Company and shall perform the duties and services prescribed herein and as may be prescribed from time to time by the Board of Directors of the Company or any duly authorized committee thereof (the "Board"). The Executive shall perform such duties to the best of his ability and in a diligent and proper manner.

            (b)  The Company acknowledges that the Executive is devoting some of his business time to providing executive management services to certain subsidiaries of the Company, including Samsonite Europe N.V. and its direct and indirect subsidiaries. Except for time devoted to the affairs of Samsonite Europe N.V. and its direct and indirect subsidiaries, and except during customary vacation periods and periods of illness, the Executive shall, during his employment hereunder, devote his full business time and attention to the performance of services for the Company, and as determined by the Board. As part of the Executive's duties hereunder, it is contemplated that the Executive shall travel to the Company's headquarters in Denver, Colorado as may be necessary or appropriate to perform his duties hereunder.

            (c)  Nothing in this Agreement shall affect the Executive's duty of loyalty and duty of care to the Company and its subsidiaries as provided under applicable state laws.

            (d)  If the Company has a committee of senior executives to oversee the Company's operations, then the Company shall cause the Executive to be a member of such committee.

        4.    COMPENSATION AND RELATED MATTERS

            (a)  Salary. During the period of the Executive's employment hereunder, the Company or a subsidiary of the Company shall pay to the Executive a salary ("Base Salary") in equal installments in accordance with normal payroll practices of the Company but not less frequently than monthly. The Base Salary shall be payable at the rate of $325,000 per annum. The payments of Base Salary hereunder shall not in any way limit or reduce any other obligation of the Company hereunder, and no other compensation, benefit or payment hereunder shall in any way limit or reduce the obligation of the Company to pay the Executive's Base Salary hereunder. The Board, at any time and from time to time, may increase (but not reduce) the Base Salary payable under this Agreement, and increase in the Base Salary shall become effective at the time indicated by the Board without the need for an amendment to this Agreement.

            (b)  Expenses. The Executive shall be entitled to receive prompt reimbursement from the Company of all reasonable expenses incurred by the Executive in performing services hereunder, including all expenses of travel and living expenses while away from home on business or at the request of and in the service of the Company, in accordance with the policies and procedures established by the Company from time to time.    The Executive shall furnish the Company with evidence that all such expenses covered by this Section 4(b) were incurred as the Company may from time to time reasonably request.

            (c)  Intentionally Omitted.

            (d)  Incentive Bonus. The Executive shall be eligible to receive an annual incentive bonus (the "Incentive Bonus") in respect of each fiscal year of the Company that ends during the Term (each, a "Reference Year"), subject to the provisions of Section 6. For each Reference Year ending after January 31, 2001, the Incentive Bonus shall consist of two parts, an EBITDA Target Bonus (comprising 75% of the Incentive Bonus) and an Individual Performance Bonus (comprising 25% of the Incentive Bonus), both of which shall be calculated as a percentage of the fixed sum of $525,000 (the "Base Amount"), as set forth below. It is contemplated that the Executive's Incentive Bonus for the relevant Reference Year will equal 100% of the Base Amount, if 100% of the targeted EBITDA and 100% of the targeted individual performance are achieved.

              (i)    The EBITDA Target Bonus is intended to reflect an assessment of the financial performance of the Company on a consolidated basis. The Board, in consultation with the CEO, shall determine the EBITDA target for each Reference Year (the "Annual EBITDA Target"), promptly after the business plan for such Reference Year is presented to, and approved by, the Board (such business plan, the "Business Plan"). The Executive shall be informed of the Annual EBITDA Target promptly after it is determined by the Board. It is understood that the Annual EBITDA Target for the relevant Reference Year will be based on the Business Plan for such Reference Year, and will represent a realistic and achievable forecast that is not intended to be unduly conservative or aggressive. Notwithstanding the foregoing, the Annual EBITDA Target for the relevant Reference Year shall include the EBITDA of the Company's non-U.S. operations at the exchange rate specified in the Business Plan for such Reference Year, and shall eliminate the effect of any realized or unrealized hedging gains and/or losses reflected in the Business Plan. The Board shall have the right, acting unilaterally and in good faith, to adjust any Annual EBITDA Target upon the occurrence of any acquisition, disposition or other significant event, that was not contemplated at the time that such target was determined. "EBITDA" means, for the relevant Reference Year, the Company's consolidated operating earnings, plus depreciation and amortization (as reflected in the Company's audited financial statements), adjusted so that it is calculated on the same basis as the Annual EBITDA Target for such Reference Year (including, without limitation, the exchange rate calculation referred to above); provided that EBITDA shall exclude extraordinary gains and/or losses and gains and/or losses from the sale of assets outside of the ordinary course of business, unless such gains and/or losses were reflected in the Business Plan. The "EBITDA Attainment Percentage" means, for the relevant Reference Year, the quotient obtained by dividing EBITDA by the Annual EBITDA Target.

              (ii)  The EBITDA Target Bonus for the relevant Reference Year shall be that percentage of the Base Amount set forth in the right-hand column of the following table directly opposite the EBITDA Attainment Percentage set forth in the left-hand column of said table. "BA" in the table refers to the Base Amount.

EBITDA Attainment %
  % of BA
Less than 90 0
90 18.75
91 24.38
92 30.00
93 35.63
94 41.25
95 46.88
96 52.50
97 58.13
98 63.75
99 69.38
100 75.00
101 76.13
102 77.25
103 78.38
104 79.50
105 80.63
106 81.75
107 82.88
108 84.00
109 85.13
110 86.25
111 88.88
112 91.50
113 94.13
114 96.75
115 99.38
116 102.00
117 104.63
118 107.25
119 109.88
120 112.50
Greater than 120 112.50

        5.    TERMINATION

        The Executive's employment hereunder may be terminated under the following circumstances:

        6.    COMPENSATION UPON TERMINATION

        If this Agreement terminates on February 1, 2007, as provided in Section 2, no severance payment shall be due and payable.

        7.    LEGAL FEES; REIMBURSEMENT OF CERTAIN EXPENSES

        The Company shall promptly reimburse the Executive for the reasonable legal fees and expenses incurred by the Executive in connection with enforcing or defending any right of the Executive pursuant to this Agreement; provided that the Company shall have no obligation to reimburse the Executive for any such fees and expenses unless the resolution of any action taken by the Executive to enforce such right is in favor of the Executive. In addition, the Company hereby agrees that the amount of any such legal fees and expenses reimbursed to the Executive in connection with obtaining or enforcing any right or benefit provided to the Executive by the Company pursuant to or in accordance with this Agreement shall not be taken into account by the Company in determining the aggregate compensation paid or payable to the Executive under this Agreement.

        8.    INDEMNIFICATION

        The Company shall indemnify the Executive (and his legal representatives), unless expressly prohibited by applicable law, against all losses, claims, damages, liabilities, costs, charges and expenses 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 his being or having been a director, officer or employee of the Company (including payment of expenses in advance of the final disposition of the proceeding). The Company further agrees, upon demand by the Executive, promptly to reimburse the Executive for, or pay, any loss, claim, damage, liability or expense, unless expressly prohibited by applicable law, to which the Company has agreed to indemnify the Executive pursuant to Sections 7 and 8 hereof. If any action, suit or proceeding is brought or threatened against the Executive in respect of which indemnity may be sought against the Company pursuant to the foregoing, the Executive shall notify the Company promptly in writing of the institution of such action, suit or proceeding. Such action, suit or proceeding shall be defended by and be under the exclusive control of the Company and its counsel; except that the Executive shall have the right to designate separate counsel, acceptable to the Executive in his sole discretion, and, to the extent of a conflict of interest with the Company, the right to direct, control and supervise the Executive's defense of such action, suit or proceeding.

        9.    TAXES

        The Company shall deduct from all amounts payable under this Agreement all federal, state, local and other taxes required by law to be withheld with respect to such payments.

        10.  CONFIDENTIALITY AND NONCOMPETITION

        11.  SUCCESSORS; BINDING AGREEMENT

        12.  NOTICE

        For purposes of this Agreement, notices, demands and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given (i) when hand delivered, (ii) when sent if sent by overnight mail, overnight courier or facsimile transmission or (iii) when mailed by United States certified mail, return receipt requested, postage prepaid, addressed as follows:

(with a copy to the attention of: General Counsel, at the same address) or to such other address as any party may have furnished to the others in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt.

        13.  SURVIVORSHIP

        The respective rights and obligations of the parties hereunder set forth in Sections 6, 7, 8, 9 and 10 of this Agreement shall survive any termination of this Agreement to the extent necessary to the intended preservation of such rights and obligations.

        14.  REPRESENTATIONS AND WARRANTIES

        The Company represents and warrants that (a) it is fully authorized and empowered to enter into this Agreement and that its Board has approved the terms of this Agreement, (b) the execution of this Agreement and the performance of its obligations under this Agreement shall not violate or result in a breach of the terms of any material agreement to which the Company is a party or by which it is bound, (c) no approval by any governmental authority or body is required for it to enter into this Agreement, and (d) the Agreement is valid, binding and enforceable against the Company in accordance with its terms, except to the extent affected or limited by applicable bankruptcy laws or other statutes governing the rights of creditors generally and any regulations or interpretations thereof. The Executive represents and warrants that his execution of this Agreement and his performance of his duties and responsibilities under this Agreement shall not violate or result in a breach of the terms of any material agreement to which he is a party or by which he is bound.

        15.  MISCELLANEOUS

contain the entire understanding and agreement between them, and supersedes all prior understandings and agreements between the parties respecting the employment by the Company of the Executive, and that the provisions of this Agreement may not be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing signed by the parties hereto. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement.

        16.  VALIDITY

        The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision or provisions of this Agreement, which shall remain in full force and effect.

        17.  COUNTERPARTS

        This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.

        IN WITNESS WHEREOF, the Company has caused its name to be subscribed to this Agreement by its duly authorized representative and the Executive has executed this Agreement as of the date and the year first above written.


SAMSONITE CORPORATION

 

LUC VAN NEVEL

By

/s/  RICHARD H. WILEY      

 

/s/  LUC VAN NEVEL      

Name:

Richard H. Wiley

 

 

Title:

Chief Financial Officer, Treasurer and Secretary

 

 

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