exv10w7






EXHIBIT 10.7




SERVICE AGREEMENT




	 	 	 
	BETWEEN:

	 	UNILIN INDUSTRIES BVBA with registered office at B-8710
Wielsbeke-Belgium, Ooigemstraat 3 hereinafter referred to as “the
Company”;
	 
	 	 
	AND:
	 	 
	 
	 	 
	 

	 	Comm. V. “Bernard Thiers”, with a registered office at B-9700 Eine-Belgium,
Nestor de Tièrestraat 128 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) daily management of the Company as President-Unilin, (ii) strategy
definition, (iii) build a new executive management team, (iv) succession planning for
executives and (v) providing advice and support to Unilin.
	 
	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. Bernard Thiers,
being director / manager of the Service Provider, it has been agreed that Mr. Bernard Thiers
will render the services on behalf of the Service Provider at least 5 days per week. It being
understood that Mr. Thiers 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.




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	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
automatically expiring on December 31, 2013. After expiration of the aforementioned period,
parties can renew the agreement for indefinite duration upon mutual agreement.
	 
	2.2	 	The present agreement can be terminated at any time by the Company upon notice of 22 (twenty
two) months. Notice shall be given by registered mail. However, the Company can also
terminate the present agreement at any time by payment of a lump sum allowance equal to the
Base Amount (as defined below) multiplied by 1.85. The present agreement can be terminated at
any time by the Service Provider upon notice of 6 (six) months.
	 
	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 510,396 (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 473,196 (“Base Amount”) and a retainer amount of EUR
37,200 (“Retainer”). Said Annual Fee has been determined based on an expected average volume
of work corresponding to 5 days per week.




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	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.
	 
	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 115% of the Base Amount of the year
concerned.
	 
	3.4	 	The Service provider shall not be entitled to any other compensation or benefits other than
those set forth under sections 3.1, 3.2 and 3.3 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.




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	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.




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	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:






	 	(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.




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	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.




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	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 9, 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/ Bernard Thiers
	 
	 	 
	Jeffrey S. Lorberbaum 

Chairman and Chief Executive Officer
	 	Bernard Thiers






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