Document:

Exhibit
10.1

 

[English Translation of Original
Icelandic Language Document]

 

Agreement on Termination of Employment

and Stock
Option Arrangements

 

The undersigned parties

 

Íslensk erfðagreining ehf.

State Reg. No. 691295-3549, Sturlugata 8

(hereinafter referred to as the “Employer”),

deCODE genetics, Inc., the parent company
of the Employer,

and the seller of shares, which is a listed company in
the United States,

(hereinafter referred to as “deCODE”)

for the first part,

 

and Hannes Þór Smárason, Id. No. 251167-3389,

(hereinafter referred to as the “Employee”)

hereby enter into the following

 

Agreement

 

1.
Wages during period of notice and earned vacation rights

The Employee and ÍE have reached an agreement
on the Employee’s termination of work. The Employee’s last day of work is
today. The Employee ceases to be an “Officer” and “Executive Officer” at deCODE
genetics as of the present date.  It is
agreed that the Employee will be paid his fixed wages during the agreed notice
period until 31 December 2004, for which the Employer does not require a
full time work contribution. The parties agree, however, that the Employer may
seek advice from the Employee without remuneration beyond the fixed wages paid
to him, as further provided in Article 3. Earned vacation pay will be paid
out with the final wage payment on 31 December of this year.

 

2.
Telephone and computer

The Employer has had in his possession  a laptop computer and a mobile telephone in
connection with his work. It is agreed that the Employee will keep in his
ownership these devices as of the termination of his employment. ÍE will pay
the subscription fees in respect of the mobile telephone until 31
December 2004. In addition, the Employee has had the use of ADSL equipment
located in his home. It is agreed that the employee will have the continued use
of the equipment and that ÍE will pay the subscription fees in respect of the
ADSL connection until 31 December 2004. After that it is agreed that the
Employee will have the ownership of this ADSL equipment.

 

3.
Continued consultancy work

The Employee agrees to provide advice to the
Employee until 31 December 2004 and also after that time if requested by
the Employer. Following the end of wage payments on 31 December 2004, a
separate agreement will be made concerning

 

1

 

consultancy, which will be paid for based on
invoices submitted indicating number of hours.

 

4. Confidentiality

The Employee shall maintain in full
confidence all information relating to the affairs of deCODE and its
subsidiaries, the substance of this severance agreement and all other
information to which he had access in the course of his work.

 

5. Stock
options

 

	
  Time of

  granting of

  option

  	
   

  	
  Number of

  Shares

  	
   

  	
  Price per

  share in USD

  	
   

  	
  Position:

  	
   

  
	
  (a) January 1998 (option early
  exercised by issuing a promissory note and pledging of shares)

  	
   

  	
  300,000

  	
   

  	
  0.20

  	
   

  	
  Contract performed in full.  Shares held by holding company owned by
  employee.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (b) November 1999  (option early exercised bye issuing a note
  and pledging of shares)

  	
   

  	
  260,000

  	
   

  	
  5.625

  	
   

  	
  Contract 
  ended on 1 November 2003.  Note became due and the Company redeemed 240,096 of the pledged shares
  as a payment for the note.  Balance
  of 19,904 shares accrued to the Employee and are his property.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (c) 5 November 2003

  	
   

  	
  260,000

  	
   

  	
  5.625

  	
   

  	
  Contract in effect.  Option earned in full, but unexercised.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (d) 5 November 2003

  	
   

  	
  140,000

  	
   

  	
  7.06

  	
   

  	
  Contract in effect.  Three-year vesting period began in
  November 2003. (At the time of signature, 1/6 has been earned, i.e.
  23,333 shares)

  	
   

  

 

Pursuant to Article 3 hereof, the
Employee holds the position of consultant to deCODE and subsidiaries. During
the term of effect of the consultancy relationship it is agreed that the
Employee will remain within the deCODE option plan for his options pursuant to
(c) and (d) above.

 

Specifically, the agreement is as follows:

 

2

 

•                  The 260,000 stock options of 5
November 2003 (see item (c) above) will not automatically terminate 90
days from 31 December, but will continue to be exercisable for 90 days
following the end of the consultancy relationship.

•                  The 140,000 stock options of 5
November 2003 (see item (d) above) will continue to accrue until the end
of the consultancy relationship and will be exercisable on the conclusion of
the consultancy relationship.

 

Íslensk erfðagreining and deCODE undertake
the obligation to inform the Employee by a written notice to his legal domicile
when the consultancy relationship is ended in the understanding of the
company’s stock option plan.

 

6. Announcement of
termination of employment

The Employee is an “Executive Officer” of
deCODE genetics to this day.

 

The termination of employment will be
announced with  a press release to be
released today after the close of the markets in the US. The parties agree that
the termination is taking place in full amicability.

 

7. Final Settlement

This Agreement provides for a
final settlement in relation to the Employee’s termination of work, and, on
fulfilment of the terms hereof, the parties shall have no further claims
against each other.

 

 

	
   

  	
  Reykjavík, 18 June 2004.

  
	
   

  	
   

  
	
   

  	
   

  
	
  For Íslensk erfðagreining ehf.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Kári Stefánsson

  	
   

  	
   

  
	
  Kári Stefánsson /sign/

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  For deCODE
  genetics, Inc.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Kári Stefánsson

  	
   

  	
   

  
	
  Kári Stefánsson /sign/

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Hannes Smárason

  	
   

  	
   

  
	
  Hannes Smárason /sign/

  	
   

  

 

3Exhibit
10(A)i

 

NON-STATUTORY STOCK OPTION
AGREEMENT

 

THIS AGREEMENT is entered into and effective as of
this ___ day of _______ (the “Date of Grant”), by and between Ecolab Inc. (the
“Company”) and
                  
(the “Optionee”).

 

A.            The
Company has adopted the Ecolab Inc. 2002 Stock Incentive Plan (the “Plan”),
authorizing the Board of Directors of the Company, or a committee as provided
for in the Plan (the Board or such a committee to be referred to as the
“Committee”), to grant non-statutory stock options to employees of the Company
and its Subsidiaries.

 

B.            The
Company desires to give the Optionee an inducement to acquire a proprietary
interest in the Company and an added incentive to advance the interests of the
Company by granting to the Optionee an option to purchase shares of common
stock of the Company pursuant to the Plan.

 

Accordingly, the parties agree as follows:

 

ARTICLE 1.  GRANT OF OPTION.

 

The Company hereby grants to the Optionee the option
(the “Option”) to purchase 
                         
(         ) shares (the “Option
Shares”) of the Company’s common stock, $1.00 par value (the “Common Stock”),
according to the terms and subject to the conditions hereinafter set forth and
as set forth in the Plan.  The Option is
not intended to be an “incentive stock option,” as that term is used in Section
422 of the Internal Revenue Code of 1986, as amended (the “Code”).

 

ARTICLE 2.  OPTION EXERCISE PRICE.

 

The per
share price to be paid by Optionee in the event of an exercise of the Option
will be $         .

 

ARTICLE 3.  DURATION OF OPTION AND
TIME OF EXERCISE.

 

3.1           Initial
Period of Exercisability.  The Option
will be exercisable, on a cumulative basis, as to one-third of the Option
Shares (excluding any fractional portion less than one share), on each of the
first and second anniversaries of the Date of Grant and as to the remaining
Option Shares on the third anniversary of the Date of Grant.  This Option will remain exercisable as to all
unexercised Option Shares until 5:00 p.m. (St. Paul, Minnesota time) on the
tenth anniversary of the Date of Grant (“Time of Termination”).

 

 

3.2           Termination
of Employment.

 

(a)           In
the event that the Optionee’s employment with the Company and all Subsidiaries
is terminated by reason of the Optionee’s death or Disability, this Option will
become immediately exercisable in full and will remain exercisable for a period
of five years after such termination (but in no event will this Option be
exercisable after the Time of Termination).

 

(b)(i)       In the event that the Optionee’s employment with
the Company and all Subsidiaries is terminated by reason of the Optionee’s
Retirement, then, subject to clause (ii) hereof, this Option, if it has been
outstanding at least six months from the Date of Grant, will become exercisable
in full immediately prior to such termination and remain exercisable for a
period of five years after such termination (but in no event will this Option
be exercisable after the Time of Termination);

 

(ii)           The
acceleration of exercisability of the Option provided for in clause (i) hereof
will not occur in the event that the Optionee has committed an act which
constitutes Cause, which shall be determined by the Committee acting in its
sole discretion, irrespective of whether such action or the Committee’s
determination occurs before or after termination of the Optionee’s employment
with the Company or any Subsidiary.

 

(c)           In
the event the Optionee’s employment with the Company and all Subsidiaries is
terminated for any reason other than death, Disability or Retirement, all
rights of the Optionee under the Plan and this Agreement will immediately
terminate without notice of any kind, and this Option will no longer be
exercisable; provided, however that if such termination is due to any reason
other than termination by the Company or any Subsidiary for Cause, this Option
will remain exercisable to the extent exercisable as of such termination for a
period of three months after such termination (but in no event will this Option
be exercisable after the Time of Termination).

 

3.3           Change in Control.  In the event of a Change in Control, then
this Option, if it has been outstanding for at least six months from the Date
of Grant, will become immediately exercisable in full and will remain
exercisable in accordance with the provisions of this Agreement.

 

3.4           Effects
of Actions Constituting Cause. 
Notwithstanding anything in this Agreement to the contrary, in the event
that the Optionee is determined by the Committee, acting in its sole
discretion, to have committed any action which would constitute Cause,
irrespective of whether such action or the Committee’s determination occurs
before or after termination of the Optionee’s employment with the Company or
any Subsidiary, all rights of the Optionee under the Plan and this Agreement
shall terminate and be forfeited without notice of any kind.  The Company may defer the exercise of this
Option for up to forty-five (45) days in order for the Committee to make any
determination as to the existence of Cause.

 

 

ARTICLE 4.  MANNER OF OPTION EXERCISE

 

4.1           Notice.  This Option may be exercised by the Optionee
in whole or in part from time to time, subject to the conditions contained in
the Plan and in this Agreement, by delivery, in person, by facsimile or
electronic transmission or through the mail, to the Company at its principal
executive office in St. Paul, Minnesota (Attention:  Sr. Vice President-Human Resources), of a
written notice of exercise.  Such notice
will be in a form satisfactory to the Committee, will identify the Option, will
specify the number of Option Shares with respect to which the Option is being
exercised, and will be signed by the person or persons so exercising the
Option.  Such notice will be accompanied
by payment in full of the total purchase price of the Option Shares
purchased.  In the event that the Option
is being exercised, as provided by the Plan and Section 3.2 above, by any
person or persons other than the Optionee, the notice will be accompanied by
appropriate proof of right of such person or persons to exercise the
Option.  As soon as practicable after the
effective exercise of the Option, the Optionee will be recorded on the stock
transfer books of the Company as the owner of the Option Shares purchased, and
the Company will deliver to the Optionee one or more duly issued stock
certificates evidencing such ownership. 
In the event that the Option is being exercised, as provided by
resolutions of the Committee and Section 4.2 below, by tender of a Broker
Exercise Notice, the Company will deliver such stock certificates directly to
the Optionee’s broker or dealer or their nominee.

 

4.2           Payment.  At the time of exercise of this Option, the
Optionee will pay the total purchase price of the Option Shares to be purchased
solely in cash (including a check, bank draft or money order, payable to the
order of the Company); provided, however, that the Committee, in its sole
discretion, may allow such payment to be made, in whole or in part, by tender
of a Broker Exercise Notice, by tender, or attestation as to ownership, of
Previously Acquired Shares that have been held for the period of time necessary
to avoid a charge to the Company’s earnings for financial reporting purposes
and that are otherwise acceptable to the Committee, or by a combination of such
methods.  In the event
the Optionee is permitted to pay the total purchase price of this Option in
whole or in part by tender or attestation as to ownership of Previously
Acquired Shares, the value of such shares will be equal to their Fair Market Value
on the date of exercise of this Option.

 

4.3           Reload
Grants.  To the extent that (a) this
Option is exercised in whole or in part during the term of the Optionee’s
employment with the Company or any Subsidiary; and (b) the exercise price is
satisfied by the Optionee by tender or attestation of ownership of Previously
Acquired Shares, then the Optionee will automatically be granted, effective as
of such date of exercise, a Reload Option to purchase the number of shares
tendered or attested to in exercising this Option and the number of shares
tendered, attested to or withheld to satisfy tax obligations associated with
that portion of this Option exercised by such tender or attestation, at an
exercise price equal to the Fair Market Value on the date of grant.  The Reload Option will be a Non-Qualified
Option as defined in the Plan, will be fully vested on the date of grant, and
will expire at the

 

 

original
Time of Termination set forth in Section 3.1, or earlier upon the Optionee’s
termination of employment as provided in Section 3.2.  The right to receive a Reload Option under
this Section will accrue, on the terms and conditions set forth above, solely
to the Optionee, and not to any permitted transferee under the terms of the
Plan.  A further Reload Option will not
accrue or be granted on a Reload Option.

 

ARTICLE 5.  NONTRANSFERABILITY.

 

Neither this Option nor the Option Shares acquired
upon exercise may be transferred by the Optionee, either voluntarily or
involuntarily, or subjected to any lien, directly or indirectly, by operation
of law or otherwise, except as provided in the Plan.  Any attempt to transfer or encumber this
Option or the Option Shares other than in accordance with this Agreement and
the Plan will be null and void and will void this Option.

 

ARTICLE 6.  EMPLOYMENT.

 

Nothing in this Agreement will be construed to (a)
limit in any way the right of the Company to terminate the employment or
service of the Optionee at any time, or (b) be evidence of any agreement or
understanding, express or implied, that the Company will retain the Optionee in
any particular position, at any particular rate of compensation or for any
particular period of time.

 

ARTICLE 7.  WITHHOLDING TAXES.

 

7.1           General
Rules.  The Company is entitled to
(a) withhold and deduct from future wages of the Optionee (or from other
amounts which may be due and owing to the Optionee from the Company), or make
other arrangements for the collection of, all legally required amounts
necessary to satisfy any federal, state or local withholding and
employment-related tax requirements attributable to the grant or exercise of
this Option or otherwise incurred with respect to this Option, or (b) require
the Optionee promptly to remit the amount of such withholding to the Company
before acting on the Optionee’s notice of exercise of this Option.  In the event that the Company is unable to
withhold such amounts, for whatever reason, the Optionee must promptly pay the
Company an amount equal to the amount the Company would otherwise be required
to withhold under federal, state or local law.

 

7.2           Special
Rules.  The Committee may, in its
sole discretion and upon terms and conditions established by the Committee,
permit or require the Optionee to satisfy, in whole or in part, any withholding
or tax obligation as described in Section 7.1 above by electing to tender, or
by attestation as to ownership of, Previously Acquired Shares that have been
held for the period of time necessary to avoid a charge to the Company’s
earnings for financial reporting purposes and that are otherwise acceptable to
the 

 

 

Committee, or by a
Broker Exercise Notice, or by a combination of such methods.  For purposes of satisfying a Participant’s
withholding or employment-related tax obligation, Previously Acquired Shares
tendered or covered by an attestation will be valued at their Fair Market
Value.

 

ARTICLE 8.  ADJUSTMENTS.

 

In the event of any reorganization, merger,
consolidation, recapitalization, liquidation, reclassification, stock dividend,
stock split, combination of shares, rights offering, divestiture or
extraordinary dividend (including a spin-off), or any other change in the
corporate structure or shares of the Company, the Committee (or, if the Company
is not the surviving corporation in any such transaction, the board of
directors of the surviving corporation), in order to prevent dilution or
enlargement of the rights of the Optionee, will make appropriate adjustment
(which determination will be conclusive) as to the number, kind and exercise
price of securities subject to this Option.

 

ARTICLE 9.  SUBJECT TO PLAN.

 

9.1           Terms
of Plan Prevail.  The Option has been
and the Option Shares granted and issued pursuant to this Agreement will be
granted and issued under, and are subject to the terms of, the Plan.  The terms of the Plan are incorporated by
reference in this Agreement in their entirety, and the Optionee, by execution
of this Agreement, acknowledges having received a copy of the Plan. The
provisions of this Agreement will be interpreted as to be consistent with the
Plan, and any ambiguities in this Agreement will be interpreted by reference to
the Plan.  In the event that any
provision of this Agreement is inconsistent with the terms of the Plan, the
terms of the Plan will prevail.

 

9.2           Definitions.  Unless otherwise defined in this Agreement,
the terms capitalized in this Agreement have the same meanings as given to such
terms in the Plan.

 

ARTICLE 10.  MISCELLANEOUS.

 

10.1         Binding
Effect.  This Agreement will be
binding upon the heirs, executors, administrators and successors of the parties
to this Agreement.

 

10.2         Governing
Law.  This Agreement and all rights
and obligations under this Agreement will be construed in accordance with the
Plan and governed by the laws of the State of Minnesota without regard to
conflicts of laws provisions.  Any legal
proceedings related to this Agreement will be brought in an appropriate
Minnesota court, and the parties to this Agreement
consent to the exclusive jurisdiction of the court for this purpose.

 

 

10.3         Entire
Agreement.  This Agreement and the
Plan set forth the entire agreement and understanding of the parties to this
Agreement with respect to the grant and exercise of this Option and the
administration of the Plan and supersede all prior agreements, arrangements,
plans and understandings relating to the grant and exercise of this Option and
the administration of the Plan.

 

10.4         Amendment
and Waiver.  Other than as provided
in the Plan, this Agreement may be amended, waived, modified or canceled only
by a written instrument executed by the parties hereto or, in the case of a
waiver, by the party waiving compliance.

 

10.5         Captions.  The Article, Section and paragraph captions
in this Agreement are for convenience of reference only, do not constitute part
of this Agreement and are not to be deemed to limit or otherwise affect any of
the provisions of this Agreement.

 

10.6         Counterparts.  For convenience of the parties hereto, this
Agreement may be executed in any number of counterparts, each such counterpart
to be deemed an original instrument, and all such counterparts together to
constitute the same agreement.

 

The parties to this Agreement have executed this
Agreement effective the day and year first above written.

 

	
   

  	
  ECOLAB INC.

  
	
   

  	
   

  
	
   

  	
   By

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   Its

  	
  Sr. Vice President,
  Human Resources

  

 

 

	
  [By execution of this Agreement,

  the Optionee acknowledges having

  received a copy of the Plan.]

  	
   

  	
  OPTIONEE

  
	
   

  	
   

  	
   

  
	
   

  	
   By

  	
   

  	
   

  
	
   

  	
   

  	
  (Signature)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   SSN:

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