Exhibit 10.1, Olaf Karasch Agreement
EXHIBIT 10.1
SERVICE AGREEMENT
(Includes Change in Control
Provisions)
This Service Agreement is made by
and between TOR Minerals International, Inc. (the "Corporation"), and Dr. Olaf Karasch (the
"Officer"). The Corporation and the Officer agree as follows:
1. Term. Officer has served as CEO of the Corporation
since July 2006 and Managing Director of TOR Processing & Trade B.V., a subsidiary of the
Corporation, since May 11, 2001. The term of this Agreement shall be for a period of five
years, beginning July 1, 2011, and ending July 1, 2016; provided that, the change in control
provisions beginning in Section 6 shall continue in effect as provided below.
2. Services. Officer agrees to continue to serve as CEO
of the Corporation and conduct the business affairs of the Corporation in accordance with the law
and the Corporation's bylaws.
3. Compensation. For all services rendered by Officer
under this Agreement, Officer shall be paid an annual salary of €277,920.00 (Euros) to be paid
in monthly installments. An annual salary adjustment based on the original base salary shall
take place in January of each year until January, 2016, based on inflation and cost of living
increases in Europe, following the same procedure in effect for the preceding five years.
Payments of Officer's salary shall be allocated between the Corporation and TOR Processing &
Trade B.V. In addition to his salary, Officer may be entitled to a discretionary annual bonus
based on his overall job performance. Officer's job performance shall be evaluated each year
by the compensation committee of the Corporation.
4. Intellectual Property. All intellectual property,
including patents and trademarks, developed by or with the participation of Officer shall be owned
by the Corporation.
5. Restrictive Covenants. (a)
Confidentiality. Officer shall keep all Confidential Information confidential
forever. Confidential Information includes all information relating to the operation of the
Corporation, relating to the clients of the Corporation and their confidential information,
relating to financial information of the Corporation and its principals and staff, and relating to
all other business information of the Corporation that is not generally known to the public.
Officer agrees that all of the information described above is the exclusive and valuable property
of the Corporation, and may not ever be used by Officer except as necessary for the performance of
his duties as an employee of the Corporation.
(b) Non-Competition. Officer agrees that the Corporation has invested
considerable time, effort, and expense in developing its business. Officer agrees that he
will not compete, directly or indirectly, with the Corporation or any activities of the Corporation
during the term of this Agreement and for twelve (12) months following any termination of this
Agreement or any other termination of services on behalf of the Corporation other than in
connection with a change in control as provided below. In the event of a change in control,
the non-competition period shall extend for the period equal to the period of compensation provided
to Officer under such change in control provisions. By illustration, but not in limitation of
the foregoing, Officer will not engage in the production of specialty mineral products, whether
directly or indirectly, as a sole proprietor, partner, shareholder, officer, director, contractor,
or independent contractor.
(c) Enforceability. Officer agrees that, in the event of any breach
of the restrictive covenants contained herein, the Corporation shall be entitled to immediate
injunctive relief. Officer and the Corporation further agree that if any portion of these
restrictive covenants is found by final order of a court of competent jurisdiction to be
unreasonable or otherwise unenforceable, the remaining portions shall nevertheless be enforceable
to the extent that such court shall deem them enforceable; and in such event it is the mutual
intentions of the parties that the court reform this Agreement in order to make it enforceable to
the maximum extent possible. Officer and the Corporation agree to be bound by the restrictive
covenants as reformed, in the same manner and to same extent as the original restrictive
covenants. Officer and the Corporation further agree to be bound by the covenants as written,
unless and until reformed by the court.
Change In
Control Provisions
6. Term of Change in Control Provisions. The
change in control provisions of this Agreement shall continue in effect through the term of this
Agreement; provided, however, that in the absence of any renewal of this Agreement the term of
these provisions shall automatically be extended on an annual basis thereafter unless, no later
than nine (9) months prior to any scheduled expiration, the Corporation shall have given notice to
Officer that it does not wish to extend these provisions; provided, further, that, notwithstanding
any such notice of the Corporation not to extend, if a change in control of the Corporation shall
have occurred during the original or any extended term of this Agreement, these provisions shall
continue in full force and effect. The parties acknowledge that the two (2) years of change
in control benefits provided by these provisions have no practical effect in the event of a change
in control with more than two (2) years remaining on the term of the Agreement, but these
provisions particularly apply in the event of any change in control during the final two (2) years
or any extension term of this Agreement.
7. Change in Control. No benefits shall be payable under
this Agreement unless there shall have been a change in control of the Corporation. For purposes of
this Agreement, a "change in control of the Corporation" shall mean a change of control of a nature
that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A
promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), whether or
not the Corporation is in fact required to comply with that regulation, provided that, without
limitation, such a change in
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