EXHIBIT 10.23
CONFIDENTIAL SEVERANCE AGREEMENT
This agreement between SOLA INTERNATIONAL, INC., a Delaware
corporation (the "Company) and Xxxxx X. Xxxxxxx (the "Executive") is dated and
entered into as of January 1, 1997. The Company and the Executive hereby agree
as follows:
WHEREAS, the Executive is a valued employee of the Company;
and
WHEREAS, the Company desires to provide the Executive with
certain benefits should his employment be terminated:
THEREFORE, in consideration of the foregoing, the Company and
the Executive have agreed to the following terms while he is employed and in the
event of such a Severance:
1. Employment Term. The Executive acknowledges that he is
employed at-will by the Company subject only to the terms of this Agreement. The
Executive agrees to devote substantially all of his productive time, ability and
attention to the business of the company while he is employed by the Company,
and shall not, directly or indirectly, render services of a business, commercial
or professional nature to any other person or organization, whether for
compensation or otherwise, without the prior consent of the President of the
Company or his designee.
2. Severance. In the event that any of the following occurs,
the Executive shall be entitled to the benefits set forth in paragraph 3 below.
For purposes of this Agreement a Severance shall have taken place only if:
A. The Executive's employment with the Company is
terminated for any reason other than cause. For purposes of this Agreement,
"cause" is defined as the Executive's engaging in: (i) willful misconduct,
neglect of duties, or any act or omission any or all of which materially
adversely affect the Company's business, or (ii) conviction of a felony.
(i) For purposes of subparagraph 2.A(i), no
such event or omission shall constitute cause unless the Executive fails to cure
the underlying matter within forty-five (45) days after receipt from the Company
of a detailed statement of the cause for termination.
B. The Executive is regularly assigned duties and
responsibilities that materially diminish his position as an Executive of the
Company. For the purpose of this subparagraph, the assignment of duties, other
than those Executive performs as of the date of this Agreement, whether or not
in lieu of those
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previously assigned duties, does not by itself constitute a material
diminishment of the Executive's position with the Company.
C. The Executive's compensation (including but not
limited to salary and benefits) is reduced and that reduction is not part of, or
is disproportionate to a company general reduction of executive compensation.
The Executive shall not be entitled to any Severance Benefits
as set forth in paragraph 3 of this Agreement if he freely and voluntarily
resigns his employment with the Company.
3. Severance Benefits. If a Severance takes place, then
immediately after the occurrence of that event or events, the Executive shall be
entitled to the following:
A. To continue to receive his compensation for either
the period of twelve (12) months or one (1) month per completed year of service
with the Company, up to a maximum of (18) months , whichever is longer,
commencing the first of the month following the month in which the Severance
takes place. For purposes of this paragraph, the Executive's "compensation"
shall be that annual salary in effect immediately prior to the Severance, plus
the average of Management Incentive Plan compensation (or successor thereto)
paid to him over the three years immediately prior to the Severance.
B. To continue for either a period of twelve (12)
months or one (1) month per completed year of service with the Company up to a
maximum of eighteen (18) months whichever is longer to be covered by and
participate in, at the Company's expense, any and all benefit plans the Company
regularly provides its other executives or employees including, but not limited
to, health, dental, vision, pension or other retirement plans.
C. To receive outplacement assistance in the form of
professional consultation and administrative assistance, subject to the approval
of the Company, which shall not be unreasonably withheld. The Company shall pay
up to a maximum of twenty-five thousand dollars ($25,000.00) for the
aforementioned outplacement services during the period the Executive receives
Severance Benefits as described in A and B above.
4. Non-Mitigation. The Executive shall not be required to
mitigate the amount of any payments or other benefits provided under this
Agreement at any time by seeking other employment or consultancy; however the
Executive shall notify the Company of any employment or consulting engaged in
during the period covered by Severance Benefits provided in Section 3 and the
amounts payable and benefits provided shall be reduced or offset by the amount
of any salary, bonus of any sort, fees, stock, stock options, stock dividends,
other securities or any non-cash consideration so paid or payable and benefits
to be received with respect to such
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period and that offset or reduction shall be determined by the Company in the
complete and absolute exercise of its sole discretion.
5. Non-Disparagement. In the event of a Severance both the
Executive and the Company agree that neither of them will disparage the other in
any manner.
6. Covenants-Not to Compete and Not to Solicit.
A. Covenant Not to Compete.
The Executive recognizes that the services to be
performed while employed by the Company are special, unique, and extraordinary
and that by reason of the Executive's prior and continued employment with the
Company the Executive has acquired and will acquire confidential information and
trade secrets concerning the Company's operations ("Company Confidential
Information") and the operations of its parent and affiliates ("Affiliate
Confidential Information"). Accordingly, it is agreed that during the period of
Employment by the Company, and for any period following a Severance covered by
payments provided for in Section 3 hereof, the Executive will not, directly or
indirectly, as an officer, director, stockholder, partner, associate, owner,
employee, consultant or otherwise, become or be interested in or associated with
any other corporation, firm or business engaged in the same or a similar or
competitive business with the Company or any of its affiliates in any
geographical area in which the Company or any of its affiliates are then engaged
in business, provided that the Executive's ownership, directly or indirectly, of
not more than one percent of the issued and outstanding stock of a corporation
the shares of which are regularly traded on a national securities exchange or in
the over-the-counter market shall not, in any event, be deemed to be a violation
of this subsection.
B. Covenant Not to Solicit.
The Executive agrees not to solicit any person
employed by the Company or its affiliates who perform a scientific, technical,
sales or marketing function. As used herein, "solicit" or "soliciting" means any
direct or indirect approach or appeals to such an employee to leave the Company.
Indirect solicitation includes but is not limited to, acting through a third
party or parties or characterizing job advertisements or opportunities in such a
fashion so as to entice any employee. The executive agrees that, if approached
by a Company employee, the Executive will:
(i) Inform the employee of the Executive's
obligations set forth in this subparagraph;
(ii) Refer the employee to the relevant Company
Human Resources personnel; and
(iii) Request that the employee confirm in writing
to the Company that he has approached the
Executive and
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confirm that request in a memorandum to such
Human Resources organization.
7. Confidentiality. The Executive recognizes that the services
to be performed while employed by the Company are special, unique, and
extraordinary and that by reason of the Executive's prior and continued
employment with the Company the Executive has acquired and will acquire
confidential information and trade secrets concerning the Company's operations
("Company Confidential Information") and the operations of its parent and
affiliates ("Affiliate Confidential Information"). Accordingly, it is agreed
that:
A. The Executive shall not divulge to any entity or
person, other than the Company or its affiliates, or, in the event of an
assignment of this Agreement pursuant to Section 10 hereof, the assignee and its
affiliates, if any, whether while employed or after a Severance, any Company
Confidential Information concerning the Company's customer lists, research or
development programs or plans, processes, methods or any other of its trade
secrets, except information that is then available to the public in published
literature and became publicly available through no fault of the Executive.
B. The Executive shall not divulge to any person or
entity, including an assignee of this Agreement and its affiliates, but
excepting the Company and its affiliates, whether while employed or after a
Severance, any Affiliate Confidential Information acquired by the Executive
concerning the customer lists, research or development programs or plans,
processes, methods or any other trade secrets of the parent or any affiliate,
except information which is then available to the public in published literature
and became publicly available through no fault of the Executive.
C. The Executive acknowledges that all information
the disclosure of which is prohibited hereby is of a confidential and
proprietary character and of great value to the Company and its affiliates. Upon
a Severance, the Executive shall forthwith deliver up to the Company all
records, memoranda, data and documents of any description which refer or relate
in any way to Company Confidential Information or Affiliate Confidential
Information and return to the Company any of its equipment and property which
may then be in the Executive's possession or under the executive's personal
control. Upon the assignment of this Agreement, pursuant to Section 10, the
Executive shall forthwith deliver up to the Company all records, memoranda, data
and documents of any description which refer or relate in any way to Affiliate
Confidential Information and return to the Company any of its equipment and
property which may then be in the Executive's possession or under the
Executive's personal control.
D. The Executive agrees that while employed and for a
two year period after the occurrence of a Severance not to disclose the terms of
this Agreement to any person other than the Executive's immediate family, the
executive's attorneys, accountants and other professional advisors or a
prospective employer permitted hereby, except as otherwise required by law.
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8. Invention Assignment. The Executive agrees that any
invention made by the Executive while employed shall belong to the Company if
(i) it was made in the normal course of the duties of the Executive or in the
course of duties falling outside the Executive's normal duties but specifically
assigned to the Executive, and the circumstances in either case were such that
an invention might reasonably be expected to result from the carrying out of
such duties, or (ii) the invention was made in the course of the duties of the
Executive and, at the time of making the invention, because of the nature of the
Executive's duties and the particular responsibilities arising from the nature
of the Executive's duties, the Executive had a special obligation to further the
interests of the Company. In addition, if (x) the Executive while employed shall
make any improvement or develop any know-how, copyrightable work or design, (y)
such improvement, know-how, copyrightable work or design is relevant to the
business of the Company or any of its subsidiaries, and (z) such improvement,
know-how, copyrightable work or design arouse directly out of any work carried
out while employed, or out of Confidential Company Information or Confidential
Affiliate Information to which the Executive had access while in the employ of
the Company, then such improvement, know-how, copyrightable work or design shall
belong to the Company whether or not it was disclosed to the Company while
employed by the Company.
A. In the event that the Executive makes any
invention or develops any improvement, know-how, copyrightable design or work
which belongs to the Company, the Executive shall fully, freely and immediately
communicate the same to the Company and the Executive shall, if and as desired
by the Company execute all documents and do all acts and things at the Company's
cost which may be necessary or desirable to obtain letters patent or other
adequate protection in any part of the world for such invention, improvement,
know-how, copyrightable work or design and to vest the same in the Company for
the Company's benefit. The Executive hereby irrevocably appoints the Company as
the Executive's attorney in the Executive's name and on the Executive's behalf
to execute all such deeds and documents and to do all such acts and things as
may be necessary to give effect to this Subsection in the event that the
Executive fails to comply within seven days with the written directions given by
the Company pursuant to this Subsection.
B. The Executive has been notified and understands
that the provisions of Subsections 6(g) and 6(h) hereof do not apply to any
invention that qualifies fully under the provisions of Section 2870 of the
California Labor Code, which states as follows:
(i) Any provision in an employment agreement
which provides that an employee shall assign, or offer to assign, any of his or
her rights in an invention to his or her employer shall not apply to an
invention that the employee developed entirely on his or her own time without
using the employer's equipment, supplies, facilities, or trade secret
information except for those inventions that either:
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(1) Relate at the time of
conception or reduction to practice of the invention to the employer's business,
or actual or demonstrably anticipated research or development of the employer;
or
(2) Result from any work performed
by the employee for the employer.
(ii) To the extent a provision in an
employment agreement purports to require an employee to assign an invention
otherwise excluded from being required to be assigned under subdivision (a), the
provision is against the public policy of this state and is unenforceable.
9. Remedies. The Company shall be entitled, in addition to any
other right or remedy that it may have at law or in equity with respect to a
breach of this Agreement by the Executive (including the right to terminate
payments pursuant to Section 3 hereof), to an injunction, without the posting of
a bond or other security, enjoining or restraining the Executive from any
violation or threatened violation of this section, and the Executive hereby
consents to the issuance of such an injunction.
10. Moral Rights Waiver. "Moral Rights" means any right to
claim authorship of a work, any right to object to any distortion, or other
modification of a work, and any similar right, existing under the law of any
country in the world, or under any treaty. Executive hereby irrevocably
transfers and assigns to the Company any and all Moral Rights that Executive may
have in any services or materials. Executive also hereby forever waives and
agrees never to assert against client, its successors or assigns and any and all
Moral Rights Executive may have in any services or materials, even after
termination of this Agreement.
11. Release. In consideration of the payments and covenants
made in this Agreement, the Executive hereby releases the Company, its
Employees, officers, directors, subsidiaries, affiliates, successors and assigns
and the Company, its subsidiaries, affiliates, successors and assigns hereby
release the Executive from any and all claims for relief or causes of action
relating to any matters of any kind arising out of his employment (or its
termination) with the Company excepting those claims for relief for causes of
action relating to the Severance Benefit obligations of the Company under
Section 3 of this Agreement.
The Executive expressly waives all rights and remedies under
Section 1542 of the Civil Code of the State of California which provides as
follows:
A general release does not extend to claims which the creditor
does not know or suspect to exist in his favor at the time of
executing the release, which if known by him must have
materially affected his settlement with the debtor.
The Executive understands that if the facts with respect to
which this Agreement is executed are found hereafter to be different from the
facts which you now believe to be true, the Executive expressly accepts and
assumes the risk of such
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possible differences in facts and agrees that this Agreement shall be and remain
effective notwithstanding such differences in facts.
12. Notices. All notices, consents, waivers or demands of any
kind which either party to this Agreement may be required or may desire to serve
on the other party in connection with this Agreement shall be in writing and may
be delivered by personal service or sent by telegraph or cable or sent by
registered or certified mail, return receipt requested with postage thereon
fully prepaid. All such communications shall be addressed as follows:
THE COMPANY: Sola International, Inc.
Xxxxx 000
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000
THE EXECUTIVE:
Xxxxx X. Xxxxxxx
00 Xxxx Xxxxxx
Xxxxxxx, XX 0000
Xxxxxxxxx
If sent by telegraph or cable, a confirmed copy of such
telegraphic or cable notice shall be promptly sent by mail (in the manner
provided above) to the addressees. Service of any such communication made only
by mail shall be deemed complete on the date of actual delivery as shown by the
addressee's registry or certification receipt or at the expiration of the third
(3rd) business day after the date of mailing which ever is later in time. Either
party hereto may from time to time, by notice in writing served upon the other
as aforesaid, designate a different mailing address or a different person to
which such notices or demands are thereafter to be addressed or delivered.
Nothing contained in this Agreement shall excuse either party from giving oral
notice to the other when prompt notification is appropriate, but any oral notice
given shall not satisfy the requirement of written notice as provided in this
paragraph.
13. Choice of Law. This Agreement shall be governed and
construed and enforced in accordance with the laws of the State of California
(regardless of that jurisdiction or any other jurisdictions choice of law
principles).
14. Assignment. This Agreement may be assigned by the Company
to any affiliate of the Company or to any non-affiliate of the Company that
shall succeed to the business and assets of the Company. In the event of such
assignment, the Company shall cause such affiliate or non-affiliate as the case
may be, to assume the obligations of the Company hereunder by written agreement
addressed to the Executive concurrently with any assignment with the same effect
as if such assignee were the Company hereunder. This Agreement is personal to
the Executive and the
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Executive may not assign any rights or delegate any responsibilities hereunder
without the prior approval of the Company.
15. Entire Agreement. This Agreement is the entire Agreement
between the Company and the Executive with respect to the subject matter hereof
and cancels and supersedes any and all other agreements regarding the subject
matter hereof between the parties. This Agreement may not be altered, modified,
changed, or discharged except in writing signed by both of the parties.
16. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instruments.
17. Construction. If any one or more of the provisions (or any
part thereof) of this Agreement shall be held to be invalid, illegal or
unenforceable in any respect of validity, legality and enforceability of the
remaining provisions (or any part thereof) shall not in any way be affected or
impaired thereby.
18. Arbitration. With respect to any controversy arising out
of or relating to this Agreement, or the subject matter thereof, such
controversy shall be settled by final and binding arbitration in Palo Alto,
California in accordance with the then existing rules ("the Rules") of the
American Arbitration Association ("AAA) and judgment upon the award rendered by
the arbitrators may be entered in any court having jurisdiction thereof;
provided however, that the law applicable to any controversy shall be the law of
California, regardless of its or any jurisdictions choice of law principles.
Arbitration shall be the sole and exclusive remedy for the resolution of the
disputes described above. In any such arbitration, the award or decision shall
be rendered by a majority of the members of a board of arbitration, consisting
of three (3) members, one of whom shall be appointed by each party and the third
of whom shall be the chairman of the panel and be appointed by mutual agreement
of said two party appointed arbitrators. In the event of the failure of said two
arbitrators to agree, within five (5) working days after the commencement of the
arbitration, upon appointment of the third arbitrator, the third arbitrator
shall be appointed by the AAA in accordance with the Rules. In the event that
either party shall fail to appoint an arbitrator within five (5) days after the
commencement of the arbitration proceeding, such arbitrator and the third
arbitrator shall be appointed by the AAA in accordance with the Rules. The
arbitrator is empowered but, not limited, in making an award in favor of the
Executive to require any act or acts which they believe necessary to effectuate
the intent of this Agreement. The Company agrees that any costs of any
arbitration brought whether by the Executive or the Company including the
Executive's reasonable attorney's fees and expenses and the costs, fees and
expenses of the Executive's party appointed arbitrator, shall be borne in their
entirety by the Company
19. THE EXECUTIVE ACKNOWLEDGES THAT HE HAS HAD THE OPPORTUNITY
TO CONSULT WITH THE ADVISOR OF HIS CHOICE AND THAT HE HAS FREELY AND VOLUNTARILY
ENTERED INTO THIS AGREEMENT.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year written below.
Sola International, Inc.
By /s/ Xxxxx Xxx
---------------------
/s/ Xxxxx Xxxxxxx
Xxxxx X. Xxxxxxx
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