EXHIBIT 10.39
CHANGE OF CONTROL AGREEMENT
     THIS CHANGE OF CONTROL AGREEMENT (this “Agreement”) is effective as of the
[___] day of [___], 200[_], between [UTi, Services, Inc., a California
corporation] (the “Company”), and [___] (“Employee”).
RECITALS
     WHEREAS, the Company has determined that it is in the best interests of the
Company, UTi Worldwide Inc. (“UTi Worldwide”) and the related group of entities
and companies (UTi Worldwide, the Company and such related entities and
companies are referred to herein collectively as the “UTi Group”) to ensure that
the UTi Group will have the continued dedication of Employee, notwithstanding
the possibility, threat or occurrence of a “Change of Control of UTi Worldwide”
(as defined on Exhibit A attached to this Agreement and incorporated herein).
     NOW, THEREFORE, in consideration of the promises and covenants set forth
below, the parties hereto agree as follows:
     1. Termination of Employment Following a Change of Control of UTi
Worldwide.
          (a) Subject to the terms and conditions of this Agreement, the Company
hereby agrees to provide the Employee with the payments described in Section
1(b) below in the event that Employee’s employment with the Company is
terminated by the Company other than for Cause (as defined below), death or
Disability (as defined below) during the period commencing on the effective date
of a Change of Control of UTi Worldwide and ending on the first anniversary of
such effective date (such period shall be referred to herein as the “Effective
Period”). For purposes of this Agreement, termination for “Cause” shall include
any termination by the Company as a result of (i) Employee’s willful failure to
perform or the gross negligence in the performance of Employee’s material duties
to the UTi Group (and if such willful failure or gross negligence is susceptible
to cure by Employee, the failure to effect such cure by Employee within thirty
(30) days after written notice of such willful failure or gross negligence is
given to Employee), (ii) Employee’s engagement in an act of dishonesty involving
or affecting the UTi Group or the falsification of records thereof,
(iii) Employee’s indictment or conviction for a crime of theft, embezzlement,
fraud, misappropriation of funds or other alleged act of dishonesty by Employee,
or other crime involving moral turpitude, or (iv) Employee’s engagement in any
violation of law relating to Employee’s employment or violation by Employee of
Employee’s duty of care or loyalty to the UTi Group. For purposes of this
Agreement, Employee shall be deemed to have become “Disabled” or to have
suffered a “Disability” to the extent Employee is or has been incapable of
performing substantially all of Employee’s duties and responsibilities to the
Company for one hundred twenty (120) days or more in the aggregate during any
consecutive twelve (12) months.
          (b) If Employee’s employment is terminated by the Company during the
Effective Period other than for Cause, death or Disability, neither the Company
nor the UTi Group shall have any further obligation or liability to Employee
except that Employee shall be

 

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entitled to receive (a) the Accrued Benefits (as defined below) and
(b) severance equal to twelve (12) months of Employee’s then current monthly
salary, subject to the condition set forth in Section 1(c) below. Subject to
Section 18 below, such severance shall be payable in twelve (12) equal monthly
installments commencing within sixty (60) days after Employee’s termination of
employment. For purposes of this Section 1(b), the phrase “Accrued Benefits
shall mean, with respect to Employee (i) the portion of Employee’s base salary
which has been earned up to the date of termination, (ii) compensation for any
accrued and unused vacation up to the date of termination, (iii) reimbursement
for business expenses properly incurred up to the date of termination and
(iv) such benefits or payments to which Employee may be entitled under the terms
and conditions of any benefit, equity, incentive or compensation plan, program
or award applicable to Employee and Employee’s termination of employment to the
extent accrued for the benefit of, or owing to, Employee as of the date of such
termination of employment, excluding the terms of any severance or similar plan
applicable to Employee (collectively, the “Accrued Benefits”).
          (c) Employee agrees that it is a condition precedent to the Company’s
obligations to pay the severance payments provided for in Section 1(b) above
that Employee execute a general release and waiver prepared by the Company
releasing and forever discharging the Company and the UTi Group and each and all
of their respective owners, shareholders, members, predecessors, successors,
assigns, agents, directors, officers and other representatives from any and all
claims, charges, complaints, liabilities, controversies, rights, demands, costs,
and expenses (other than the obligations of the Company set forth in
Section 1(b)), and that such general release become irrevocable within sixty
(60) days of Employee’s termination of employment. Employee agrees that Employee
will not assign or transfer, or purport to assign or transfer, to any person any
claim or a portion thereof or any interest therein that Employee might have
against the UTi Group.
     2. Not a Contract of Employment.
     Employee acknowledges and agrees that Employee is an “at will” employee
whose employment may be terminated at any time for any or no reason, and except
as specifically provided for herein, without liability. Nothing in this
Agreement confers on Employee any right of continued employment or restricts the
Company’s right to terminate Employee’s employment at any time for any or no
reason.
     3. Exclusivity of Payments. Employee acknowledges and agrees that Employee
is not entitled to any severance payments or other severance benefits from the
Company, UTi Worldwide or the UTi Group, other than the payments and benefits
expressly provided in Section 1(b) of this Agreement, except for any benefits
which may be due to Employee in the normal course under any then applicable
employee benefit plan or program of the Company that provides for benefits after
termination of employment in accordance with the terms of such plan or program.
Employee’s right to receive payments or benefits under this Agreement upon
termination of employment will cease if Employee breaches any provision of
Sections 4 or 5 below.

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     4. Proprietary Information.
          (a) Definition. Employee hereby acknowledges that Employee possesses
and may make use of, acquire, create, develop or add to certain confidential
and/or proprietary information regarding the UTi Group and its businesses and
affiliates (whether in existence prior to, as of or after the date hereof,
collectively, “Proprietary Information”), which Proprietary Information shall
include, without limitation, all of the following materials and information
(whether or not reduced to writing and whether or not patentable or protected by
copyright): trade secrets, inventions, processes, formulae, programs, technical
data, “know-how,” procedures, manuals, confidential reports and communications,
marketing methods, product sales or cost information, new product ideas or
improvements, customer-tailored solutions and other consulting products and
processes, new packaging ideas or improvements, research and development
programs, identities or lists of suppliers, vendors or customers, financial
information and financial projections or any other confidential or proprietary
information relating to the UTi Group and/or its business. The term “Proprietary
Information” shall also include, without limitation, any confidential or
non-public information of suppliers or customers of the UTi Group obtained by
Employee in the course of Employee’s employment or association with the Company
or the UTi Group. The term “Proprietary Information” does not include any
information that (i) at the time of disclosure is generally available to and
known by the public (other than as a result of its disclosure by Employee),
(ii) becomes available to Employee on a lawful, non-confidential basis from a
person other than the UTi Group or its suppliers or customers or its or their
representatives, provided that the source of such information was not known by
Employee to be subject to an obligation of confidentiality or otherwise
disclosed such information to Employee with the reasonable expectation that it
would remain confidential.
          (b) Nondisclosure. During the term of this Agreement and thereafter,
Employee will not, without the prior express written consent of the Chief
Executive Officer of UTi Worldwide, disclose or make any use of any Proprietary
Information except as may be required in the course of the performance of
Employee’s services under this Agreement.
          (c) Agreement Not to Solicit Employees and Customers. To protect the
Proprietary Information and trade secrets of the UTi Group, Employee agrees,
during the term of Employee’s employment with the UTi Group and for a period of
one (1) year thereafter, not to, directly or indirectly, either on Employee’s
own behalf or on behalf of any other person or entity, (i) to attempt to
persuade, induce or solicit or employ any person who is an employee of the UTi
Group or otherwise encourage such employee to cease or terminate his or her
employment with the UTi Group or (ii) use or otherwise disclose any Proprietary
Information in any attempt to persuade any customer of the UTi Group to cease to
do business or to reduce the amount of business which any customer of the UTi
Group has customarily done or contemplates doing with the UTi Group or to expand
its business with a competitor of the UTi Group.
          (d) Reasonableness. Employee agrees that the covenants and agreements
contained in this Section 4 are reasonable and necessary to protect the
Proprietary Information of the UTi Group and that the covenants and agreements
by Employee contained in this Section 4 shall be in addition to any other
agreements and covenants Employee may have agreed to in any other employee
proprietary information, confidentiality, non-disclosure or other similar
agreement and that this Section 4 shall not be deemed to limit such other
covenants and

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agreements, all of which shall continue to survive the termination of this
Agreement in accordance with their respective terms. A breach of the terms and
covenants of such other covenants and agreements shall be deemed to be a breach
of the provisions of this Section 4 and this Agreement.
     5. Protection of Property. All records, files, manuals, documents,
specifications, lists of customers, forms, materials, supplies, computer
programs and other materials furnished to the Employee by the UTi Group, used on
its behalf or generated or obtained during the course of the performance of the
Employee’s services hereunder, shall at all times remain the property of the UTi
Group. Upon termination of Employee’s employment with the UTi Group, Employee
shall immediately deliver to the UTi Group, or its authorized representative,
all such property, including all copies, remaining in Employee’s possession or
control.
     6. Specific Performance. In the event of the breach by Employee of any of
the provisions of Sections 4 or 5, the Company and the UTi Group, in addition to
all other rights and remedies they may have, may apply to any court of law or
equity of competent jurisdiction for specific performance and/or injunctive or
other relief to the extent authorized by law in order to enforce or prevent any
violations of the provisions thereof.
     7. Arbitration. The parties hereto acknowledge that it is in their best
interests to facilitate the informal resolution of any disputes arising out of
this Agreement or otherwise by mutual cooperation and without resorting to
litigation. As a result, if either party has a legally recognized claim or
dispute arising hereunder or otherwise, including but not limited to any claim
for breach of any contract or covenant (express or implied), any dispute
regarding Employee’s termination of employment, tort claims, claims for
harassment or discrimination (including, but not limited to, race, sex,
religion, national origin, age, handicap or disability), claims for compensation
or benefits (except where a benefit plan or pension plan or insurance policy
specifies a different claims procedure) and claims for violation of public
policy or, any federal, state or other governmental law, statute, regulation or
ordinance (except for claims involving workers’ compensation benefits), and the
parties are unable to reach agreement among themselves within thirty (30) days,
then the parties agree to submit the dispute to JAMS for binding arbitration in
accordance with its then-current employment rules and applicable law. If the
parties are unable to agree to an arbitrator, JAMS will provide the names of
seven potential arbitrators, giving each party the opportunity to strike three
names. The remaining arbitrator will serve as the arbitration panel. The parties
agree that the arbitration must be initiated within the time period of the
statute of limitations applicable to the claim(s) if the claim(s) had been filed
in Court. Arbitration may be initiated by the aggrieved party by sending written
notice of an intent to arbitrate by registered certified mail to all parties and
to JAMS. The notice must contain a description of the dispute, the amount
involved and the remedies sought. All fees and expenses of the arbitrator will
be borne by the Company. Each party will pay for the fees and expenses of its
own attorneys, experts, witnesses, and preparation and presentation of proofs
and post-hearing briefs, unless the party prevails on a claim for which
attorneys’ fees are recoverable by statute, in which case the arbitrator may
award attorneys’ fees and costs to the prevailing party.
     8. Representation by Counsel. Employee acknowledges that Employee has been
given the opportunity to consult legal counsel and seek such advice and
consultation as Employee deems appropriate or necessary.

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     9. Successors; UTi Group. This Agreement is personal to the Employee and is
not assignable by the Employee. This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns. If a particular
action is required to be taken, or a particular notice is required to be given,
by the Company, and such action or notice is in fact taken by, or such notice is
in fact given by, UTi Worldwide or another member of the UTi Group, then such
action or notice shall be deemed to have been taken or given by the Company.
Notwithstanding anything to the contrary contained in this Agreement, Employee
agrees that Employee is an employee only of the Company (or its successors or
assigns, if applicable) and not an employee of any other entity or member of the
UTi Group; provided, however, that the Company may assign Employee to another
member of the UTi Group for payroll purposes.
     10. 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 when personally delivered, or if sent by
overnight, commercial air courier service, on the second business day after
being delivered to the air courier service, or if mailed, on the fifth day after
being sent by first class, certified or registered mail, return receipt
requested, postage prepaid, addressed as follows:

     
If to Employee:
  At Employee’s address as indicated on the books and records of the relevant
member of the UTi Group.
 
   
If to Company:
  At the UTi Group corporate offices at 100 Oceangate, Long Beach, California
90802, Attention: General Counsel.

Such communications may also be delivered to such other address as any party may
have furnished to the other in writing in accordance herewith, except that
notices of change of address shall be effective only upon receipt thereof.
     11. Section 280G. To the extent that Section 280G and any related
provisions of the Internal Revenue Code of 1986, as amended, are applicable,
Employee’s payments and benefits under this Agreement and all other arrangements
or programs shall not, in the aggregate, exceed the maximum amount that may be
paid to Employee without triggering golden parachute penalties under
Section 280G and related provisions of the Internal Revenue Code of 1986, as
amended, as determined in good faith by the Company’s independent auditors. If
Employee’s benefits must be cut back to avoid triggering such penalties,
Employee’s benefits will be cut back in the priority order Employee designates
or, if Employee fails to promptly designate an order, in the priority order
designated by the Company. Employee and the Company agree to reasonably
cooperate with each other in connection with any administrative or judicial
proceedings concerning the existence or amount of golden parachute penalties on
payments or benefits Employee receives.
     12. Resignation from Positions. Upon Employee’s cessation of employment
with the Company for any reason, Employee agrees that Employee shall be deemed
to have resigned as an officer and as a director from every entity and company
of the UTi Group for which Employee is then serving as an officer or director,
and any other entity or company for which Employee is then serving as a director
or officer at the request of the Company or the UTi Group, in each case
effective as of the date of cessation of Employee’s employment. Employee

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hereby grants the corporate secretary of UTi Worldwide an irrevocable power of
attorney to execute on behalf of Employee all such resignations and documents
and instruments and take all such other actions as reasonably necessary to carry
out the intention of this Section.
     13. Entire Agreement. This Agreement, together with the documents
referenced herein, contains the entire agreement of the parties hereto with
respect to the subject matter hereof and supersede any and all other agreements
and understandings, either oral or in writing, between the parties hereto with
respect to the subject matter hereof. Each party to this Agreement acknowledges
that no representations, inducements, promises or agreements, written, oral or
otherwise, have been made by any party, or anyone acting on behalf of any party,
which are not embodied herein, and that no other agreement, statement or promise
not contained in this Agreement shall be valid or binding.
     14. Amendment; Waiver; Governing Law. No provisions of this Agreement may
be modified, waived or discharged unless such waiver, modification or discharge
is agreed to in a writing signed by Employee and by such officer of the Company
as may be specifically designated by UTi Worldwide. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
California or if Employee is not employed in California, the jurisdiction where
Employee is employed by the Company.
     15. Validity. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.
     16. 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 will constitute one and the same instrument.
     17. Survivability. The provisions in Sections 4, 5, 6, 7, 9, 10, 11, 12,
14, 15, 17 and 19 of this Agreement shall survive any termination of this
Agreement.
     18. Withholding of Taxes; Tax Reporting. The Company may withhold from any
amounts payable under this Agreement all such taxes, and may file with
appropriate governmental authorities all such information, returns or other
reports with respect to the tax consequences of any amounts payable under this
Agreement, as may, in its reasonable judgment, be required by law.
     19. Section 409A Compliance. Employee is solely responsible and liable for
the satisfaction of any federal, state, province or local taxes that may arise
with respect to this Agreement (including any taxes arising under Section 409A
of the Code, except to the extent otherwise specifically provided in a written
agreement with the Company). Neither the Company nor any of its employees,
officers, directors, or service providers shall have any obligation whatsoever
to pay such taxes, to prevent Employee from incurring them, or to

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mitigate or protect Employee from any such tax liabilities. Notwithstanding
anything in this Agreement to the contrary, if any amounts that become due under
this Agreement on account of Employee’s termination of employment constitute
“nonqualified deferred compensation” within the meaning of Code Section 409A,
payment of such amounts shall not commence until Employee incurs a “separation
from service” within the meaning of Treasury Regulation § 1.409A-1(h). If, at
the time of Employee’s termination of employment under this Agreement, Employee
is a “specified employee” (under Internal Revenue Code Section 409A), any
payments that constitute “nonqualified deferred compensation” within the meaning
of Code Section 409A on account of Employee’s “separation from service”
(including any amounts payable pursuant to the preceding sentence) will not be
paid until after the end of the sixth calendar month beginning after Employee’s
separation from service (the “409A Suspension Period”). Within 14 calendar days
after the end of the 409A Suspension Period, Employee shall be paid a lump sum
payment in cash equal to any payments delayed because of the preceding sentence,
together with interest on them for the period of delay at a rate not less than
the average prime interest rate published in the Wall Street Journal on any day
chosen by the Company during that period. Thereafter, Employee shall receive any
remaining benefits as if there had not been an earlier delay.
     20. Termination. Notwithstanding any other provision contained herein, this
Agreement shall terminate upon the earlier to occur of (i) Employee’s cessation
of employment with the UTi Group, or (ii) twelve (12) months prior written
notice from the Company; provided, however, that, in the case of subclause
(i) of this sentence, if Employee’s employment with the UTi Group was terminated
by the Company other than for Cause or Employee’s death or Disability in
connection with or in anticipation of a Change of Control of UTi Worldwide, then
for purposes of this Agreement, Employee shall be deemed to be employed by the
Company as of the date of the Change of Control of UTi Worldwide; provided,
further, that any termination of this Agreement pursuant to subclause (ii) of
this sentence shall not relieve the Company from any obligation to make the
payments described in Section 1(b) which arises from a Change of Control of UTi
Worldwide occurring prior to the termination of this Agreement.
[Signature page follows]

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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.

          “Company”   [UTi, Services, Inc.,
a California corporation]
 
       
 
  By:    
 
       
 
  Name:    
 
       
 
  Title:    
 
       
 
        “Employee”          

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EXHIBIT A TO CHANGE OF CONTROL AGREEMENT
For purposes of the attached Change of Control Agreement, a “Change of Control
of UTi Worldwide” shall be deemed to have occurred if:
               (i) a sale, transfer, or other disposition of all or
substantially all of the assets and properties of UTi Worldwide is closed or
consummated;
               (ii) any “person,” “entity” or “group” (within the meaning of
Section 13(d)(3) and 14(d)(2)) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), other than UTi Worldwide or any majority owned
subsidiary of UTi Worldwide, becomes the “beneficial owner” (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of UTi
Worldwide representing fifty percent (50%) or more of the combined voting power
of UTi Worldwide’s then outstanding securities that have the right to vote in
the election of directors generally; provided, however, that the following shall
not constitute a “Change of Control of UTi Worldwide” for purposes of this
subclause (ii):
                         (a) any acquisition directly from UTi Worldwide
(excluding any acquisition resulting from the exercise of a conversion or
exchange privilege in respect of outstanding convertible or exchangeable
securities); or
                         (b) any acquisition by an employee benefit plan (or
related trust) sponsored or maintained by UTi Worldwide or any entity controlled
by UTi Worldwide;
               (iii) during any period of two consecutive years during the term
of this Change of Control Agreement, individuals who at the beginning of such
period constitute the Board of Directors of UTi Worldwide cease for any reason
to constitute at least a majority thereof, unless the election of each director
who was not a director at the beginning of such period has been approved in
advance by directors representing at least two-thirds of the directors then in
office who were directors at the beginning of the period; or
               (iv) UTi Worldwide is dissolved or liquidated or a merger,
reorganization, or consolidation involving UTi Worldwide is closed or
consummated, other than a merger, reorganization, or consolidation in which
holders of the combined voting power of UTi Worldwide’s then outstanding
securities that have the right to vote in the election of directors generally
immediately prior to such transaction own, either directly or indirectly, fifty
percent (50%) or more of the combined voting power of the securities entitled to
vote in the election of directors generally of the merged, reorganized or
consolidated entity (or its parent company) immediately following such
transaction.

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