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Exhibit 10.29
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of the ___ day of June 1999, by and
between STYLING TECHNOLOGY CORPORATION, a Delaware corporation ("Employer"), and
XXXXXXX X. XXXX ("Employee").
WHEREAS, Employer desires to confirm the terms of Employee's continued
employment, and Employee desires to continue such employment, upon the terms and
conditions contained herein.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants set forth in this Agreement, the parties hereto agree as follows:
1. EMPLOYMENT.
Employer hereby employs Employee, and Employee hereby accepts such
employment, as Executive Vice President and Chief Financial Officer and in such
other capacities and for such other duties and services as shall from time to
time be mutually agreed upon by Employer and Employee.
2. FULL TIME OCCUPATION.
Employee shall devote Employee's entire business time, attention, and
efforts to the performance of Employee's duties under this Agreement, shall
serve Employer faithfully and diligently, and shall not engage in any other
employment while employed by Employer.
3. COMPENSATION AND OTHER BENEFITS.
(a) SALARY. Employer shall pay to Employee, as compensation
for the services rendered by Employee during Employee's employment under this
Agreement, a salary at a rate of $175,000 per annum to be paid in equal monthly
installments, or in such other periodic installments upon which Employer and
Employee shall mutually agree. Commencing on January 1, 2000, Employee's salary
shall increase to a rate of $200,000 per annum.
(b) BONUS. Employee shall be eligible to receive an annual
bonus in such an amount, if any, to be determined by a committee of the Board of
Directors of Employer based upon such factors as may be deemed relevant by the
directors, including the performance of Employee.
(c) FRINGE BENEFITS. Employee shall be entitled to participate
in any stock option, group insurance, pension, retirement, vacation, expense
reimbursement or other plans, programs, or benefits made available from time to
time to executive officers of Employer generally during the term of Employee's
employment hereunder.
(d) REIMBURSEMENT. Employer shall reimburse Employee for all
reasonable travel and entertainment expenses and other ordinary and necessary
business
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expenses incurred by Employee in connection with the business of
Employer and Employee's duties under this Agreement. To obtain reimbursement,
Employee shall submit to Employer receipts, bills or sales slips for the
expenses incurred. Reimbursements shall be made by Employer monthly within 14
days of presentation by Employee of evidence of the expenses incurred.
(e) AUTOMOBILE. Employer shall provide employee with the use
of an automobile of equal or greater value than the automobile currently
provided by Employer to Employee.
4. TERM OF EMPLOYMENT.
(a) EMPLOYMENT TERM. The term of this Agreement shall be for a
period of two years commencing as of the date hereof and for successive two-year
periods thereafter, unless and until terminated by either party giving written
notice to the other not less than 60 days prior to the end of the then-current
term.
(b) TERMINATION UNDER CERTAIN CIRCUMSTANCES. Notwithstanding
anything to the contrary herein contained:
(i) DEATH. Employee's employment shall be
automatically terminated, without notice, effective upon the date of Employee's
death.
(ii) DISABILITY. If Employee shall fail, for a period
of more than 90 consecutive days, or for 90 days within any 180 day period, to
perform any of Employee's duties under this Agreement as the result of illness
or other incapacity, Employer may, at its option and upon notice to Employee,
terminate Employee's employment effective on the date of that notice.
(iii) UNILATERAL DECISION OF EMPLOYER. Employer may,
at its option, upon notice to Employee, terminate Employee's employment
effective on the date of that notice.
(iv) UNILATERAL DECISION BY EMPLOYEE. Employee may,
at his option and upon notice to Employer, terminate Employee's employment
effective on the date of that notice.
(v) CERTAIN ACTS. If Employee engages in a crime
against Employer involving fraud, or dishonesty, Employer may, at its option and
upon notice to Employee, terminate Employee's employment effective on the date
of that notice.
(vi) CHANGE IN CONTROL. Employee may, at his option
and upon notice to Employer, terminate Employee's employment effective on the
date of the notice in the event of a "Change in Control" of Employer, as defined
below.
(c) RESULT OF TERMINATION. In the event of the termination of
Employee's employment pursuant to Sections 4(b)(i) or (ii) above, Employee's
estate or Employee, as the case may be, shall be entitled to receive an amount
equal to Employee's fixed salary as provided
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in Section 3(a) above for a period of one year after the date of such
termination. In the event of the termination of Employee's employment pursuant
to Section 4(b)(iii) above without good cause, Employee shall receive an amount
equal to Employee's fixed salary as provided in Section 3(a) above for a period
of one year after the date of such termination. In the event of the termination
of Employee's employment pursuant to Section 4(b)(iii) above with good cause,
Employee shall receive an amount equal to Employee's fixed salary as provided in
Section 3(a) above for a period of six months after the date of such
termination. In the event of the termination of Employee pursuant to Section
4(b) (iv) above, Employee shall receive no further compensation under this
Agreement; provided, however, that if Employee shall give Employer six months or
more written notice of termination, Employee shall receive an amount equal to
Employee's fixed salary as provided in Section 3(a) above for a period of six
months after the date of such termination. In the event of the termination of
Employee pursuant to Section 4(b) (v) above, Employee shall receive no further
compensation under this Agreement. In the event of termination of Employee's
employment pursuant to Section 4(b)(vi) above, Employer shall pay Employee a
lump sum payment equal to Employee's fixed salary for three years, any unpaid
fringe benefits for the balance of the term of this Agreement, and such bonus as
may have been earned prior to the Change in Control, all within 10 days after
the termination of employment.
(d) CHANGE IN CONTROL. The term "Change in Control" of
Employer shall mean a change in control of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934 as in effect on the date of this
Agreement or, if Item 6(e) is no longer in effect, any regulations issued by the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934 which serve similar purposes; provided that, without limitation, such a
Change in Control shall be deemed to have occurred if and when (i) any person
(as such term is used in Sections 13(d) and 14(d)(2) of the Securities Exchange
Act of 1934) becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934) directly or indirectly of equity securities of
Employer representing 30 percent or more of the combined voting power of
Employer's then-outstanding equity securities; (ii) during the period of this
Agreement, individuals who, at the beginning of such period, constituted the
Board of Directors of Employer (the "Original Directors"), cease for any reason
to constitute at least a majority thereof unless the election or nomination for
election of each new director was approved (an "Approved Director") by the
unanimous vote of a Board of Directors constituted entirely of Existing
Directors and/or Approved Directors; (iii) a tender offer or exchange offer is
made whereby the effect of such offer is to take over and control Employer, and
such offer is consummated for the equity securities of Employer representing 30
percent or more of the combined voting power of Employer's then-outstanding
voting securities; (iv) Employer is merged, consolidated, or enters into a
reorganization transaction with another person and, as the result of such
merger, consolidation, or reorganization, less than 75 percent of the
outstanding equity securities of the surviving or resulting person shall then be
owned in the aggregate by the former stockholders of Employer; or (v) Employer
transfers substantially all of its assets to another person or entity which is
not a wholly owned subsidiary of Employer. Sales of Employer's Common Stock
beneficially owned or controlled by Employee shall not be considered in
determining whether a Change in Control has occurred.
(e) LOCATION. Employee shall not be required to relocate his
primary place of employment outside Maricopa County, Arizona. Any breach of this
provision shall be
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treated as a termination of Employee's employment by Employer without good cause
under Section 4(b)(iii).
5. COMPETITION AND CONFIDENTIAL INFORMATION.
(a) INTERESTS TO BE PROTECTED. The parties acknowledge that
Employee will perform essential services for Employer, its employees, and its
stockholders during the term of Employee's employment with Employer. Employee
will be exposed to, have access to, and work with, a considerable amount of
Confidential Information (as defined below). The parties also expressly
recognize and acknowledge that the personnel of Employer have been trained by,
and are valuable to, Employer and that Employer will incur substantial
recruiting and training expenses if Employer must hire new personnel or retrain
existing personnel to fill vacancies. The parties expressly recognize that it
could seriously impair the goodwill and diminish the value of Employer's
business should Employee compete with Employer in any manner whatsoever. The
parties acknowledge that this covenant has an extended duration; however, they
agree that this covenant is reasonable and it is necessary for the protection of
Employer, its stockholders, and employees. For these and other reasons, and the
fact that there are many other employment opportunities available to Employee if
he should terminate his employment, the parties are in full and complete
agreement that the following restrictive covenants are fair and reasonable and
are entered into freely, voluntarily, and knowingly. Furthermore, each party was
given the opportunity to consult with independent legal counsel before entering
into this Agreement.
(b) NON-COMPETITION. During the term of Employee's employment
with Employer and for the period ending 12 months after the termination of
Employee's employment with Employer, regardless of the reason therefor, Employee
shall not (whether directly or indirectly, as owner, principal, agent,
stockholder, director, officer, manager, employee, partner, participant, or in
any other capacity) engage or become financially interested in any competitive
business conducted within the Restricted Territory (as defined below). As used
herein, the term "competitive business" shall mean any business that (a) sells
or provides or attempts to sell or provide products or services the same as or
substantially similar to the products or services sold or provided by Employer
during Employee's employment hereunder or (b) that pursues a "roll-up" or
consolidation business strategy involving salon products; and the term
"Restricted Territory" shall mean any state in which Employer sells products or
provides services during Employee's employment hereunder.
(c) NON-SOLICITATION OF EMPLOYEES. Provided Employer is not in
breach of its obligations under this Agreement, during the term of Employee's
employment and for a period of 12 months after the termination of Employee's
employment with Employee, regardless of the reason therefor, Employee shall not
directly or indirectly, for himself, or on behalf of, or in conjunction with,
any other person, company, partnership, corporation, or governmental entity,
seek to hire or hire any of Employer's personnel or employees for the purpose of
having any such employee engage in services that are the same as or similar or
related to the services that such employee provided for Employer.
(d) CONFIDENTIAL INFORMATION. Employee shall maintain in
strict secrecy all confidential or trade secret information relating to the
business of Employer (the "Confidential Information") obtained by Employee in
the course of Employee's employment, and
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Employee shall not, unless first authorized in writing by Employer, disclose to,
or use for Employee's benefit or for the benefit of, any person, firm, or entity
at any time either during or subsequent to the term of Employee's employment,
any Confidential Information, except as required in the performance of
Employee's duties on behalf of Employer. For purposes hereof, Confidential
Information shall include without limitation any materials, trade secrets,
knowledge, or information with respect to management, operational, or investment
policies and practices of Employer; any business methods or forms; any names or
addresses of customers or data on customers or suppliers; and any business
policies or other information relating to or dealing with the management,
operational, or investment policies or practices of Employer.
(e) RETURN OF BOOKS AND PAPERS. Upon the termination of
Employee's employment with Employer for any reason, Employee shall deliver
promptly to Employer all files, lists, books, records, manuals, memoranda,
drawings, and specifications; all cost, pricing, and other financial data; all
other written or printed materials that are the property of Employer (and any
copies of them); and all other materials that may contain Confidential
Information relating to the business of Employer, which Employee may then have
in Employee's possession, whether prepared by Employee or not.
(f) DISCLOSURE OF INFORMATION. Employee shall disclose
promptly to Employer, or its nominee, any and all ideas, designs, processes, and
improvements of any kind relating to the business of Employer, whether
patentable or not, conceived or made by Employee, either alone or jointly with
others, during working hours or otherwise, during the entire period of
Employee's employment with Employer or within six months thereafter.
(g) ASSIGNMENT. Employee hereby assigns to Employer or its
nominee, the entire right, title, and interest in and to all inventions,
discoveries, and improvements, whether patentable or not, that Employee may
conceive or make during Employee's employment with Employer, or within six
months thereafter, and which relate to the business of Employer.
(h) EQUITABLE RELIEF. In the event a violation of any of the
restrictions contained in this Section is established, Employer shall be
entitled to preliminary and permanent injunctive relief as well as damages and
an equitable accounting of all earnings, profits, and other benefits arising
from such violation, which right shall be cumulative and in addition to any
other rights or remedies to which Employer may be entitled. In the event of a
violation of any provision of subsection (b), (c), (f), or (g) of this Section,
the period for which those provisions would remain in effect shall be extended
for a period of time equal to that period beginning when such violation
commenced and ending when the activities constituting such violation shall have
been finally terminated in good faith.
(i) RESTRICTIONS SEPARABLE. If the scope of any provision of
this Agreement (whether in this Section 5 or otherwise) is found by a Court to
be too broad to permit enforcement to its full extent, then such provision shall
be enforced to the maximum extent permitted by law. The parties agree that the
scope of any provision of this Agreement may be modified by a judge in any
proceeding to enforce this Agreement, so that such provision can be enforced to
the maximum extent permitted by law. Each and every restriction set forth in
this Section 5 is independent and severable from the others, and no such
restriction shall be rendered
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unenforceable by virtue of the fact that, for any reason, any other or others of
them may be unenforceable in whole or in part.
6. MISCELLANEOUS.
(a) NOTICES. All notices, requests, demands, and other
communications required or permitted under this Agreement shall be in writing
and shall be deemed to have been duly given, made, and received (i) if
personally delivered, on the date of delivery, (ii) if by facsimile
transmission, upon receipt, (iii) if mailed, three days after deposit in the
United States mail, registered or certified, return receipt requested, postage
prepaid, and addressed as provided below, or (iv) if by a courier delivery
service providing overnight or "next-day" delivery, on the next business day
after deposit with such service addressed as follows:
(1) If to Employer:
Styling Technology Corporation
0000 Xxxx Xxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: President
with a copy given in the manner
prescribed above, to:
X'Xxxxxx, Cavanagh, Anderson,
Xxxxxxxxxxxxx & Xxxxxxxx, P.A.
Xxx Xxxx Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxx, Esq.
(2) If to Employee:
Xxxxxxx X. Xxxx
0000 Xxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxx 00000
Either party may alter the address to which communications or copies are to be
sent by giving notice of such change of address in conformity with the
provisions of this Section 6 for the giving of notice.
(b) INDULGENCES; WAIVERS. Neither any failure nor any delay on
the part of either party to exercise any right, remedy, power, or privilege
under this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power, or privilege preclude any other or
further exercise of the same or of any other right, remedy, power, or privilege,
nor shall any waiver of any right, remedy, power, or privilege with respect to
any occurrence be construed as a waiver of such right, remedy, power, or
privilege with respect to any other occurrence. No waiver shall be binding
unless executed in writing by the party making the waiver.
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(c) CONTROLLING LAW. This Agreement and all questions relating
to its validity, interpretation, performance and enforcement, shall be governed
by and construed in accordance with the laws of the state of Arizona,
notwithstanding any Arizona or other conflict-of-interest provisions to the
contrary.
(d) BINDING NATURE OF AGREEMENT. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, personal representatives, successors, and assigns, except that no party
may assign or transfer such party's rights or obligations under this Agreement
without the prior written consent of the other party.
(e) EXECUTION IN COUNTERPART. This Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an original
as against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument. This Agreement shall become
binding when one or more counterparts hereof, individually or taken together,
shall bear the signatures of the parties reflected hereon as the signatories.
(f) PROVISIONS SEPARABLE. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.
(g) ENTIRE AGREEMENT. This Agreement contains the entire
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior and contemporaneous agreements and
understandings, inducements and conditions, express or implied, oral or written,
except as herein contained. The express terms hereof control and supersede any
course of performance and/or usage of the trade inconsistent with any of the
terms hereof. This Agreement may not be modified or amended other than by an
agreement in writing.
(h) PARAGRAPH HEADINGS. The paragraph headings in this
Agreement are for convenience only; they form no part of this Agreement and
shall not affect its interpretation.
(i) GENDER. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine, or
neuter, as the context requires.
(j) NUMBER OF DAYS. In computing the number of days for
purposes of this Agreement, all days shall be counted, including Saturdays,
Sundays, and holidays; provided, however, that if the final day of any time
period falls on a Saturday, Sunday, or /holiday, then the final day shall be
deemed to be the next day that is not a Saturday, Sunday, or holiday.
7. SUCCESSORS AND ASSIGNS.
This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the parties hereto; provided that because the
obligations of Employee hereunder involve the performance of personal services,
such obligations shall not be delegated by Employee. For purposes of this
Agreement successors and assigns shall include, but not be limited to, any
individual, corporation, trust, partnership, or other entity that acquires a
majority
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of the stock or assets of Employer by sale, merger, consolidation, liquidation,
or other form of transfer. Employer will require any successor (whether direct
or indirect, by purchase, merger, consolidation, or otherwise) to all or
substantially all of the business and/or assets of Employer to expressly assume
and agree to perform this Agreement in the same manner and to the same extent
that Employer would be required to perform it if no such succession had taken
place. Without limiting the foregoing, unless the context otherwise requires,
the term "Employer" includes all subsidiaries of Employer.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
STYLING TECHNOLOGY CORPORATION
By:____________________________________
Name: Xxx Xxxxxxx
Its: Chairman, President and CEO
_______________________________________
Xxxxxxx X. Xxxx, individually
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