EXHIBIT 10.15
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, dated as of February 2, 2004 (this "Agreement"), by
and between SOLA International, Inc., a Delaware corporation (the "Company"),
and Xxxxx Xxxxx (the "Executive").
WHEREAS, the Executive possesses skills and experience that are of value to the
Company; and
WHEREAS, the Company has determined that it is in its best interest to secure
the continued services and employment of the Executive on behalf of the Company
in accordance with the terms of this Agreement and the Executive is willing to
render such services on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
parties hereto agree as follows:
1. Duties. During the Employment Term, the Executive shall serve as General
Manager, Asia Pacific of the Company, with the working title of Vice
President and Managing Director, Asia Pacific and such other position(s)
as the Chief Executive Officer of the Company (the "CEO") may reasonably
designate.
The Executive shall devote all of his business time and attention and
ability to the performance of such duties, services and responsibilities,
and will use his best efforts to promote the interests of the Company. The
Executive will 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
CEO.
2. Compensation. In full consideration of the performance by the Executive of
the Executive's obligations during his employment (including any services
by the Executive as an officer, director, employee or member of any
committee of any subsidiary or affiliate of the Company, or otherwise on
behalf of Company), the Executive shall be compensated as follows:
Your remuneration package as an executive of the Company is based on a
"total cost" concept and will be to the value of A$300,000 (excluding
incentive payments), comprising the following three elements:
(i) A base salary. The final figure will depend on your choice of
vehicle and the cost to the company, as outlined below.
(ii) A fully maintained company car. Motor vehicles are kept for a period
of three years and are costed into your package on a "cost to
company" basis, including the grossed up value of Fringe Benefits
Tax.
(iii) You will continue to be a member of the SOLA Superannuation Fund,
and consistent with your employment conditions when you moved to the
US, you will be reinstated in the Fund at a position no less
favourable than had you continued your employment in Australia.
I have attached an outline of how I intend to structure your incentive
plan in this role. I have set targets based on the specific financial
goals I want to achieve in Asia Pacific. Subject to the approval or
modification of this plan by the SOLA International Compensation
Committee, this plan will apply from 1 April 2004.
In addition, you will be granted options to purchase SOLA common stock
under the SOLA International Inc. Stock Option Plan. Your grant will be
determined by the SOLA International Compensation Committee at their next
meeting.
3. Benefits.
(i) In addition to the payments and awards described in Section 3 of
this agreement, during your employment, the Executive shall be
entitled to participate in any and all employee benefit plans the
Company regularly provides its other executives or employees
including, but not limited to, health, dental, vision, pension or
other retirement plans.
(ii) The Company will pay your telephone rental and reimburse you for all
business related calls.
4. Vacation. You will be entitled to 20 days Annual Leave with no annual
leave loading. Long Service Leave will accrue from the date of your return
according to the SA Long Service Leave Act. We will make arrangements with
you regarding any portion of unused leave that has accrued during your
time in the US.
5. Termination. Employment with the Company may be terminated by either party
upon the occurrence of any of the following events:
(a) The death or disability of the Executive.
(b) The termination of employment by the Company for Cause. As
used herein, "Cause" shall mean Executive's: (i) willful
misconduct, neglect of duties, or any act or omission any or
all of which materially adversely affect the Company's
business after receipt from the Company of a detailed
statement of the cause for termination, or (ii) conviction of,
or plea of guilty or nolo contendere to, a felony.
(c) Termination of employment by the Executive or the Company
other than cause. Notice of termination of employment by the
Executive is 6 months and must be given in writing.
(d) Resignation by the Executive for Good Reason. As used herein,
"Good Reason" shall mean (i) regular assignment by the Company
to the Executive of duties and responsibilities that
materially diminish his position as General Manger, Asia
Pacific; or (ii) reduction of the Executive's Base Salary or a
material reduction in his employee benefits (other than
incentive compensation) that is not part of, or is
disproportionate to a general reduction by the Company of
executive compensation.
6. Termination Payments. If the Executive's employment with the Company
terminates the Company's, its subsidiaries' and its affiliates' sole
obligation hereunder, except as otherwise provided in this Section 6,
shall be to pay the Executive (a) any accrued and unpaid Base Salary as of
the Termination Date and (b) an amount equal to such reasonable and
necessary business expenses incurred by the Executive in connection with
the Executive's employment on behalf of the Company on or prior to the
Termination Date but not previously paid to the Executive (the "Accrued
Compensation"). In addition, if the
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Executive's employment with the Company terminates pursuant to either
Section 5(c) or Section 5(d) hereof, the Company's, its subsidiaries' and
its affiliates' sole obligation hereunder shall be to (a) pay the Accrued
Compensation, (b) continue to pay the Executive the Base Salary (at the
rate in effect at the time of termination of employment) for the greater
of six months or the severance period that is customary and practice in
SOLA Australia at the time of termination, commencing with the first of
the month following the month in which termination takes place, (c) Pay
the executive the average MIP payment over the past 3 years, proportionate
to the severance payment period as determined in (b) above, (d) continue
to provide the Executive with the benefits described in Section 4 of this
Agreement for a period of six months after the date of such termination
and (e) pay up to A$25,000 for outplacement assistance on behalf of the
Executive in the form of professional consultation and administrative
assistance during the twelve months after the date of such termination, in
the latter case, subject to the Company's approval which may not be
unreasonably withheld. All monies due under (b), (c) and (d) above will be
reduced by an amount equivalent to any and all compensation that is paid
to the Executive for services or advice of any kind provided to another
organization or individual during the severance payment period, as
determined in (b) above, following termination. The executive recognizes
and agrees to promptly and accurately report all such compensation to the
company.
The Company shall have no obligation to the Executive for any payments or
benefits other than the Accrued Compensation if the Executive terminates
his employment with the Company other than for Good Reason.
7. Executive Covenants.
(a) Unauthorized Disclosure. The Executive recognizes that the
services to be performed during the Employment Term by the
Company are special, unique, and extraordinary and that by
reason of the Executive's 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 affiliates ("Affiliate Confidential
Information"). Accordingly, it is agreed that:
(i) 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 14 hereof, the assignee and its affiliates, if
any, whether during the Employment Term or after a
severance Event, 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.
(ii) 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 during the Employment Term or after
a Severance Event, 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 Company 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.
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(iii) 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 Event, 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 14, 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.
(b) Non-competition. By and in consideration of the Company's
entering into this Agreement and the payments to be made and
benefits to be provided by the Company hereunder, and in
further consideration of the Executive's exposure to the
Company Confidential Information and Affiliate Confidential
Information, it is agreed that during his employment, and for
the period for which compensating severance payments are made
following a Severance Event or the termination of his
employment by the Executive other than for Good Reason, 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.
(c) Non-solicitation. The Executive agrees not to solicit any
person employed by the Company or its affiliates. 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 confirms in writing to the
Company that he has approached the Executive and
confirms that request in a memorandum to such Human
Resources organization.
(d) 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
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to Section 6 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 7 and Sections 8 and 9 hereof and the Executive hereby
consents to the issuance of such an injunction.
8. Proprietary Rights. The Executive agrees that any invention made by the
Executive during his employment shall belong to the Company if (a) 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 (b) 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 (a) the Executive during his employment shall
make any improvement or develop any know-how, copyrightable work or
design, (b) such improvement, know-how, copyrightable work or design is
relevant to the business of the Company or any of its subsidiaries, and
(c) such improvement, know-how, copyrightable work or design arose
directly out of any work carried out during his employment, 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 during the
Employment Term by the Company.
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.
The Executive has been notified and understands that the provisions of the
two immediately preceding paragraphs of this Section 8 do not apply to any
invention that qualifies fully under the provisions of Section 2870 of the
California Labor Code, which states as follows:
(a) 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:
(i) 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
(ii) Result from any work performed by the employee for
the employer.
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(b) 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. Non-Disparagement. In the event of a Severance Event both the Executive
and the Company agree that neither of them will disparage the other in any
manner.
10. Moral Rights Waiver. As used herein, "Moral Rights" shall mean 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 the Company, its
successors or assigns 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 under 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 arising prior to the date hereof.
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
that he now believes to be true, the Executive expressly accepts and
assumes the risk of such 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.
00000 Xxxx Xxxxx Xxx Xxxxx
Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X Xxxxxx
The Executive: Xxxxx Xxxxx
[ ]
[ ]
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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 whichever 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. Governing 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. The Company may assign this Agreement 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 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. Severability. If any one or more of the provisions (or any part thereof)
of this Agreement, or any application thereof to the circumstances, shall
be held to be invalid, illegal or unenforceable in any respect the
remaining provisions (or any part thereof) shall not in any way be
affected or impaired thereby.
17. Arbitration. Except as otherwise provided in Section 7(d) hereof, 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 San Diego, California or such other location as
the company may determine, 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
jurisdiction's choice of law principle. 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
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 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 days after the commencement of the
arbitration proceeding, such arbitrator and
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the third arbitrator shall be appointed by the AAA in accordance with the
Rules. The arbitrators are empowered but not limited in making an award in
favor of the Executive to require any act or acts that they believe
necessary to effectuate the intent of this Agreement. The Company agrees
that any costs of any arbitration borne by the Executive, including the
Executive's reasonable attorneys' fees and expenses and the costs, fees
and expenses of the Executive's appointed arbitrator, shall be borne by
the Company to the extent attributable to issues on which the Executive
prevails on the merits.
18. Excise Tax Limitation.
(a) Notwithstanding anything contained in this Agreement to the
contrary, to the extent that the payments and benefits
provided under this Agreement and benefits provided to, or for
the benefit of, the Executive under any other Company plan or
agreement (such payments or benefits are collectively referred
to as the "Payments") would be subject to the excise tax (the
"Excise Tax") imposed under Section 4999 of the Internal
Revenue Code of 1986, as amended (the "Code"), the Payments
shall be reduced (but not below zero) if and to the extent
necessary so that no Payment to be made or benefit to be
provided to the Executive shall be subject to the Excise Tax
(such reduced amount is hereinafter referred to as the
"Limited Payment Amount"). Unless the Executive shall have
given prior written notice specifying a different order to the
Company to effectuate the foregoing, the Company shall reduce
or eliminate the Payments, by first reducing or eliminating
the portion of the Payments which are not payable in cash and
then by reducing or eliminating cash payments, in each case in
reverse order beginning with payments or benefits which are to
be paid the farthest in time from the Determination (as
hereinafter defined). Any notice given by the Executive
pursuant to the preceding sentence shall take precedence over
the provisions of any other plan, arrangement or agreement
governing the Executive's rights and entitlements to any
benefits or compensation.
(b) The determination of whether the Payments shall be reduced to
the Limited Payment Amount pursuant to this Agreement and the
amount of such Limited Payment Amount shall be made, at the
Company's expense, by an accounting firm selected by the
Executive which is one of the five largest accounting firms in
the United States (the "Accounting Firm"). The Accounting Firm
shall provide its determination (the "Determination"),
together with detailed supporting calculations and
documentation to the Company and the Executive within ten (10)
days of the date of termination, if applicable, or such other
time as requested by the Company or by the Executive (provided
the Executive reasonably believes that any of the Payments may
be subject to the Excise Tax) and if the Accounting Firm
determines that no Excise Tax is payable by the Executive with
respect to the Payments, it shall furnish the Executive and
the Company with an opinion reasonably acceptable to the
Executive that no Excise Tax will be imposed with respect to
any such Payments. The Determination shall be binding, final
and conclusive upon the Company and the Executive.
19. Non-Waiver of Rights. The failure to enforce at any time the provisions of
this Agreement or to require at any time performance by any other party of
any provisions hereof shall in no way be construed to be a waiver of such
provisions or to affect either the validity of this Agreement or any part
hereof, or the right of any party to enforce each and every provision in
accordance with its terms. No waiver by any party hereto of any breach by
any other party hereto of any provision of this Agreement to be performed
by such other party shall
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be deemed a waiver of similar or dissimilar provisions at the time or at
any prior or subsequent time.
20. Headings. The headings contained herein are solely for the purposes of
reference, are not part of this Agreement and shall not in any way affect
the meaning or interpretation of this Agreement.
21. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original but all of which together
shall constitute one and the same instrument.
22. 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.
IN WITNESS WHEREOF, the Company has caused this Employment Agreement to be
executed by authority of its Board of Directors, and the Executive has hereunto
set the Executive's hand, on the day and year first above written.
SOLA International, Inc.:
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
Executive:
/s/ Xxxxx Xxxxx
------------------------------------------
Xxxxx Xxxxx
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