Exhibit 10.1

Execution Copy

SERVICE AGREEMENT

 

BETWEEN:    UNILIN INDUSTRIES BVBA with registered office at B-8710 Wielsbeke,
Belgium, Ooigemstraat 3 hereinafter referred to as “the Company”; AND:    BVBA
“F. De Cock Management”, with registered office at B-8300 Knokke - Heist,
Belgium, Zeedijk, het Zoute, 831 bus 25, hereinafter referred to as “the Service
Provider”.

PREAMBLE

Whereas, the Service Provider explains that it has the necessary skills and
expertise, and is allowed under applicable laws, to provide services in
connection with the management of commercial companies, and

Whereas, in view of the fact that the Company needs the above-mentioned services
to support the Company, of the experience of the Service Provider and its wish
to provide said services with maintenance of its independence, the Parties have
chosen to enter into the present service agreement (the Service Agreement), and

Whereas, the Service Provider can also be appointed member of the Management
Committee of the Company, if any; and

Whereas, the parties wish to specify the terms and conditions of their
collaboration:

IT HAS BEEN AGREED AS FOLLOWS:

 

1 Object

 

1.1 The Service Provider shall provide all necessary and appropriate services
(hereinafter the Services) concerning (i) assisting in the transition of the
management of the Unilin business to a new management team, (ii) providing
advice and support regarding various Unilin business issue as they may arise,
(iii) providing advice and support to Unilin regarding strategic matters and
transactions and (iv) responding to issues and questions as they arise.

 

1.2 The Service Provider shall perform the Services with the diligence, loyalty,
seriousness and competence that the Company is entitled to expect from an
experienced specialist in this position. The Service Provider shall comply with
the general guidelines and policy of the Company. The Service Provider is bound
by an obligation of best result.

 

1.3 Taking into account the skills, reputation, expertise and capabilities of
Mr. Frans De Cock, being director / manager of the Service Provider, it has been
agreed that Mr. De Cock will render the services on behalf of the Service
Provider at least 2.5 days per week. It being understood that Mr. De Cock may be
replaced at any time by the Service Provider to the extent the replacement
provides the same level of skills, reputation, expertise and capabilities as
mutually agreed upon by the parties.

 

1

--------------------------------------------------------------------------------

1.4 The Company will grant the Service Provider all powers necessary to execute
the Services in a good manner.

 

1.5 Moreover, the Service Provider can be appointed as a member of the
Management Committee of the Company, if any.

 

2 Duration

 

2.1 The present agreement is concluded for a definite duration commencing on the
execution date and expiring on December 31, 2009 but is automatically renewed
for 1 year except if one of both parties give notice in line with 2.2 hereunder.

 

2.2 The present agreement can be terminated at any time by the Company and by
the Service Provider upon notice of 3 (three) months. Notice shall be given by
registered mail.

 

2.3 This contract may, immediately and without notice or indemnity, be
terminated for serious cause by each party.

Will be considered a serious cause entitling each party to terminate the present
agreement without any indemnity:

 

  (i) the commission of a criminal offence;

 

  (ii) fraud or embezzlement;

 

  (iii) the failure to comply with or the breach of any of the material terms
and conditions of the present agreement and/or the Company’s subsidiaries’ or
branch offices’ policies within thirty(30) days after written notification of
such non-compliance if such failures or breaches are capable of remedy. If the
default or breach is not capable of remedy, the present agreement can be
terminated without prior notification;

 

  (iv) the willful or gross neglect of the duties under the present agreement
and/or the willful or gross misconduct in the performance of such duties.

 

3 Fees

 

3.1 The Services as described above are compensated by the Company on the basis
of a basic lump sum amount of EUR 248,730 (excl. VAT) per annum, which amount
may be subsequently modified by the parties upon mutual agreement (hereinafter
the “Annual Fee”). The Annual Fee, initially, shall consist of a base amount of
EUR 236,598 (“Base Amount”) and a retainer amount of EUR 12,132 (“Retainer”).
Said Annual Fee has been determined based on an expected average volume of work
corresponding to 2.5 days per week.

 

3.2 An advanced payment representing 1/12 of the Annual Fee shall be paid each
month into the bank account of the Service Provider, against remittance of a
detailed monthly invoice which meets all applicable legal & tax requirements and
is payable within 15 days from the date of issuance.

 

2

--------------------------------------------------------------------------------

3.3 In addition to the Annual Fee as set forth in 3.1 and subject to approval of
the Compensation Committee of the Board of Directors of Mohawk Industries, Inc.,
the Service Provider shall be eligible to receive an annual bonus ranging from 0
to 85% of the Base Amount of the year concerned.

 

3.4 In addition to the above mentioned fees, the Service Provider is eligible to
receive up to 5,000 options in Mohawk stock per year, subject to Compensation
Committee appproval.

 

3.5 The Service provider shall not be entitled to any other compensation or
benefits other than those set forth under sections 3.1, 3.2, 3.3 and 3.4 above.

 

4 Reimbursement of business expenses

All reasonable business expenses incurred by the Service Provider exclusively in
the performance and for the purposes of its duties will be borne by the Company
and reimbursed to the Service Provider by means of the above mentioned monthly
invoices or separated invoices provided that supporting evidences are remitted,
provided the Company’s approval with respect to the type of expenses.

 

5 Independence

 

5.1 The Service Provider shall act on an independent basis with the Company.

To the extent the Company gives instructions to the directors, managers,
representatives, officers or employees of the Service Provider entrusted with
the performance of the Services on behalf of the Service Provider, such
instructions would be strictly limited to the well-being of workers in the
performance of their work, working time and the agreed work arising from the
Services. The Company can otherwise in no way exercise authority over the
directors, representatives, officers or employees of the Service Provider.

 

5.2 Without prejudice to its obligation to perform the management of the
Company’s subsidiaries or branch offices in good faith, the Service Provider
shall freely determine its work organization, work agenda and vacation
arrangements with full respect for the needs of the business.

 

5.3 All documents and correspondences between the Company and the Service
Provider must be considered as necessary tools to enable the parties to execute
their tasks according to their obligations. These documents can in no way be
interpreted as an indication of any relationship of authority towards the
directors, representatives, officers or employees of the Service Provider.

 

5.4 The Service Provider, its directors, managers, representatives, employees,
officers, etc. are entirely responsible for complying with all statutory and
legal requirements (including, but without limiting the general nature of the
foregoing, paying taxes and social security contributions) and will indemnify
and agree to keep indemnified in full the Company in respect of any claims that
may be made by the relevant authorities against the Company in respect of social
security contributions and/or income tax in relation to any payment made
pursuant to this Service Agreement.

 

3

--------------------------------------------------------------------------------

6 Confidentiality

 

6.1 The Service Provider acknowledges and agrees that any information disclosed
to the Service Provider or its directors, managers, officers or employees by the
Company in relation with the present agreement and/or the Service Provider’
duties is confidential. The Service Provider also acknowledges and accepts that
any such information will be treated and held in strict confidence and not used
by the Service Provider nor revealed in any way whatsoever, either directly or
indirectly, to any third parties during the course of the present agreement or
after its termination.

 

6.2 The Service Provider acknowledges and agrees that any information the
Service Provider its directors, managers, officers, representatives or employees
develop under or as a result of the performance of his duties is confidential
and that any such information will be held in strict confidence and not revealed
in any way whatsoever, either directly or indirectly, to any third parties.

 

6.3 The confidentiality undertakings of articles 6.2 and 6.3 will end when the
confidential information falls in the public domain, without fault of the
Service Provider or its directors, managers, officers or employees.

 

6.4 The Service Provider must not make any publicity or media releases in the
framework of the present agreement, using the name of the Company, without its
prior written consent.

 

7 Return of property

 

7.1 All records, files, memoranda, reports, price lists, customer lists,
drawings, plans, sketches, documents and the like (together with all copies
thereof) relating to the business of the Company and all other property of the
Company related to the Service Provider’ duties (including but not limited to
documents, notes, memoranda, floppy disks, computer programs, reports, software
and all other information and data), which the Service Provider or directors,
managers, officers or employees uses or prepares or comes in contact with in the
course of executing this agreement remains, as between the Parties to the
present agreement, the sole property of the Company.

 

7.2 Upon the termination of the present agreement (however caused), the Service
Provider will immediately return to the Company all the Company’s property in
its possession or under its control without keeping copies of such items or
passing them (or the copies) to any third party, whatever the importance of it
may be.

 

8 Exclusivity and non-competition

 

8.1 The Service Provider explicitly agrees and undertakes that it shall not,
except with the prior written consent of the Company, whether directly or
indirectly, whether remunerated or not, for a period of 2 (two) years following
the termination of the present agreement by the Company or by itself and for
whatsoever reason:

 

4

--------------------------------------------------------------------------------

  (i) engage itself or through a third party, be employed by, consult for, have
an interest in or in any way assist any person or company directly or indirectly
engaged in the business of the Company or any related activities;

 

  (ii) solicit or endeavour to entice away from or discourage from being
employed by the Company any Manager or client of the Company, its subsidiaries
or branch offices, whether or not such person would commit a breach of contract
by reason of leaving employment.

 

  (iii) canvass or solicit the custom of or deal with or provide services to any
person, firm or company who at any time was client of or dealt with the course
of providing the services, to the extent it relates to competing products.

The aforementioned obligations apply in all the countries in which the Unilin
group is active.

 

8.2 The Service Provider agrees that it will exclusively act in the interest of
the Company and its shareholders.

 

9 Intellectual property

 

9.1 The Service Provider undertakes to inform the Company about any work,
invention, discovery or improvement, patentable or protectable by any other
intellectual right, including copyright or not, which it may create, design or
produce, either alone or in conjunction with others, including but not limited
to all documents, drawings, plants, designs and models, printed circuit boards,
software programs and semi-conductor chips and related documentation, in the
course of his employment or relating to, or which is likely to become connected
with, any matter whatsoever constituting or which might constitute a Company’s
activity, or which has been or may be investigated by the latter.

 

9.2 The Service Provider agrees that such work, inventions, discoveries or
improvements belong exclusively to the Company and hereby assigns and transfers
any and all right including the copyright therein to the Company. The Service
Provider shall refrain from any act which would infringe the Company’s rights,
shall execute and deliver all documents or statements necessary to implement
such assignment or transfer and shall not register any patent relating to these
inventions without the approval of the Company.

 

9.3 The Service Provider acknowledges that such assignment and transfer of
rights are adequately compensated by the remuneration as provided in the present
agreement.

 

10 Contractual provisions

 

10.1 The nullity or the enforceability of the present agreement does not affect
the validity and the enforceability of the other provisions, unless this would
upset the balance between the reciprocal rights and obligations of the parties.

 

10.2 In such case, the parties will add one or more new provisions to the
agreement in order to achieve, as much as possible, the same or a similar
result.

 

5

--------------------------------------------------------------------------------

11 Varia

 

11.1 The Service Provider shall procure that each company under his control, its
directors, managers, officers, representatives or employees and former
directors, managers, officers, representatives or employees comply with the
obligations imposed on the Service Provider under articles 6, 7, 8, 9 and 12
above.

 

12 Applicable law and jurisdiction

 

12.1 The present agreement shall be governed by and being interpreted according
to Belgian law.

 

12.2 In case of dispute arising from or further to the present agreement, the
courts or Kortrijk will be exclusively competent.

 

6

--------------------------------------------------------------------------------

13 Prior agreements

The present agreement supersedes any and all prior agreements, whether oral or
in writing, that possibly could have existed between the concerned parties with
respect to the same object and can only be modified by means of a written
agreement between all parties.

Done at Wielsbeke, on February 24, 2009, in two original copies, each party
acknowledging having received on original copy duly signed.

 

For the Company

     The Service Provider

[read and approved]

     [read and approved]

/s/ Jeffrey S. Lorberbaum

    

/s/ Frans De Cock

Jeffrey S. Lorberbaum

     Frans De Cock

 

7