AGREEMENT
This agreement is made as of January 5, 1998 between Xxx Xxxxxx, an
individual residing at 0 Xxxxx Xxxx Xxxx, Xxxxxxxxx, Xxxxxxx 00000 ("Xxxxxx")
and Vermont Pure Holdings, Ltd., a corporation with its principal place of
business on Xxxxx 00, Xxxxxxxx, XX 00000, (the "Company").
Background
A. The Company has established a division that will market spring
water, vending machines and coffee/tea products to the home/office supply market
in the New England area.
X. Xxxxxx is a principal of Vermont Coffee Time, Inc.("VCT") which is a
party to an Asset Purchase Agreement with the Company whereby the Company is
purchasing all of the assets of CTV; and, she has had considerable experience in
the business of marketing spring water, vending machines and coffee/tea products
to the home/office supply market similar to those to be conducted by the
Company.
C. Company and Xxxxxx wish to enter this Agreement to facilitate
and augment the Asset Purchase Agreement.
Terms
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, the parties agree as follows:
1. Term. Subject to Section 7 of this agreement, the term of
this Agreement shall be from January 2, 1998 through January 2, 2001.
2. Consulting Agreement. Company shall retain Xxxxxx and Xxxxxx
accepts appointment as consultant of the Company upon the terms and conditions
described herein. During the Consulting Term (as defined in Section I above),
Xxxxxx shall devote the business time, attention and skills to the business and
affairs of Company as mutually agreed to by the parties signing hereto.
2.1 Duties. Xxxxxx shall at all times render
her services at the direction of the Chief Executive Officer and President.
Xxxxxx agrees that during the Consulting Term she will be reasonably available
to the Company in person or by telephone in order to provide general business
advice, sales and marketing, customer relations and consulting services
on all aspects of the coffee business. Xxxxxx agrees to use her best efforts
to promote and further the reputation and good name of Company and
perform her services well and faithfully.
3. Restrictive Covenant. In order to protect the Company in its full
beneficial use and enjoyment of the goodwill, assets, business relationships,
marketing techniques and other know-how acquired as a result of a Asset Purchase
Agreement between the Company, Xxx Xxxxxx and VCT, for a period of three (3)
years after the execution of this Agreement (the "NonCompete Term"), Xxxxxx will
not, within the States of New York, Vermont, New Hampshire, Maine,
Massachusetts, Rhode Island, and Connecticut, directly or indirectly compete
with the Company in the home/office distribution of.- distilled water, spring or
carbonated water, coffee/tea products and will not either (I) solicit any
persons or entities known to be customers of the Buyer to purchase any of the
aforementioned products; or (ii) solicit or induce any employee of the Buyer to
leave such employment to take a position with Xxxxxx or with any company for
which she then works. During the aforesaid period, Xxxxxx shall not make any
statements or commit any acts (including contacting any of the Buyer's
customers) that would in any way be tortiously injurious or detrimental to the
Company's image, business or customer relations. The provisions of this Section
5 shall survive the termination, for any reason, of this Agreement and shall
continue for the three (3) year period contemplated by this Section 3.
4. Confidentiality . Xxxxxx agrees that she will not at any time,
either during the term of this Agreement or thereafter, divulge to any person,
firm or corporation any information obtained or learned by his during the course
of his employment with Company, with regard to the operational, financial,
business or other affairs of Company and its affiliates, and their respective
officers and directors, including, without limitation, trade secrets, customer
lists, sources of supply, pricing policies, operational methods or technical
processes, except (i) in the course of performing her duties hereunder, (ii)
with Company's express written consent; (iii) to the extent that any such
information is in the public domain other than as a result of Xxxxxx'x breach of
any of his obligations hereunder; or (iv) where required to be disclosed by
court order, subpoena or other government process. In the event that Xxxxxx
shall be required to make disclosure pursuant to the provisions of clause (iv)
of the preceding sentence, Xxxxxx shall promptly, but in no event more than 48
hours after learning of such subpoena, court order, or other government process,
notify Company, by personal delivery or by cablegram, confirmed by mail, and at
Company's expense, Xxxxxx shall: (a) take all reasonably necessary steps
requested by Company, at Company expense, to defend against the enforcement of
such subpoena, court order or other government process, and (b) permit Company
to intervene and participate with counsel of its choice in any proceeding
relating to the enforcement thereof.
4.1 All confidential information described in Section 4 shall
be the exclusive property of the Company, and Xxxxxx shall use her best efforts
to prevent any publication or disclosure thereof.
4.2 The provisions of this Section 4 shall survive the
termination, for any reason, of this Agreement and shall continue for the period
contemplated by this Section 4.
5. Remedies. Xxxxxx acknowledges that her promises with
respect to the agreement
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not to compete and to maintain the confidentiality of information in accordance
with this agreement are promises of a special, unique, unusual, extraordinary
and intellectual character, which give them peculiar value the loss of which
cannot be reasonably or adequately compensated in an action of law, and that, in
the event there is a breach of his promises with respect to her agreement not to
compete and to maintain confidentiality of information by Xxxxxx, the Company
will suffer irreparable harm, the amount of which will be impossible to
ascertain. Accordingly, the Company shall be entitled, if it so elects, to
institute and prosecute proceedings in any court of competent jurisdiction,
either at law or in equity, to obtain damages for any breach or to enforce
specific performance of the provisions or to enjoin Xxxxxx from committing any
such act in breach of this Agreement. The remedies granted to the Company in
this Agreement are cumulative and are in addition to remedies otherwise
available to the Company at law or in equity. If the Company is obliged to
resort to the courts for the enforcement of a covenant of Xxxxxx contained in
Section 3 or 4, such covenant shall be extended for a period of time equal to
the period of such breach which extension shall commence on the later of (I) the
date on which the original (unextended) term of such covenant is scheduled to
terminate or (ii) the date of the final court order (without further right of
appeal) enforcing such covenant.
6. Compensation. As compensation and consideration for Xxxxxx'x
agreement and consent to the terms of this Agreement and her assumption of the
responsibilities under this Agreement and further consideration for the Asset
Purchase Agreement entered into by and between the Company and CTV, the Company
agrees to pay Xxxxxx and Xxxxxx agrees to accept the following compensation:
6.1 The Company will pay Xxxxxx on a monthly basis on the
first of every month, compensation at an annual rate of $20,000 for the term of
this Agreement.
7. Termination. Notwithstanding anything to the contrary
contained in this Agreement, Xxxxxx'x employment or consulting may be terminated
prior to the end of the Employment and Term only as follows:
7.1 Termination Upon Death of Xxxxxx. Xxxxxx'x status as
consultant shall terminate upon the death of Xxxxxx; provided, however, that
Company shall pay to Xxxxxx'x estate or designated beneficiary, any amounts due
hereunder accrued but unpaid at Xxxxxx'x date of death.
7.2 Termination Upon Disability of Xxxxxx. Xxxxxx'x
employment shall terminate if, in good faith, and with the advice of a qualified
and independent physician, the Board of Directors of Company determines that
Xxxxxx has become, by reason of accident, illness, mental or physical
disability, so disabled as to be incapable of satisfactorily performing his
duties hereunder for a period of one hundred twenty (120) consecutive days;
provided, however that Xxxxxx shall continue to receive any amounts due
hereunder accrued but unpaid at Xxxxxx'x date of termination due to
disability, less any amount Xxxxxx receives for such period from any
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Company-sponsored or Company-paid for source of insurance, disability
compensation or government program.
7.3 Termination Upon Mutual Consent. Xxxxxx'x employment
may be terminated by the mutual consent of Company and Xxxxxx on such terms as
they may agree.
7.4 Termination For Cause. Xxxxxx'x employment shall terminate
immediately on notice to Xxxxxx upon a good faith finding of the Board of
Directors of Company that Xxxxxx has (I) wilfully or repeatedly failed to
perform her duties in accordance with the provisions of this Agreement
notwithstanding 30 day prior written notice to Xxxxxx and failure of Xxxxxx to
cure any deficiency, (ii) committed a breach of any provision of Section 3 or 4
hereof, (iii) misappropriated assets or perpetrated fraud against Company, (iv)
been convicted of a crime which constitutes a felony, or (v) been engaged in the
illegal use of habit forming substances. In the event of termination for cause,
Company shall pay Xxxxxx only her compensation through the date of termination
and will have no further liability hereunder.
7.5 Termination by Company Without Cause. The Company may
terminate this agreement at any time without cause, upon written notice to
Xxxxxx. In the event of termination pursuant to this paragraph, the Company
shall continue to pay Xxxxxx the amounts due under Section 6.1 of this Agreement
which shall survive termination of this Agreement.
8. Applicable Law. This Agreement shall be construed in
accordance with the laws of the State of Vermont, without giving effect to
principles of conflict of law.
9. Waiver of Breach. The waiver by the Company or Xxxxxx of a
breach of any provision of this Agreement by the other shall not operate or be
construed as a waiver of any other or subsequent breach of such or any other
provision.
10. Notices. Any notice required or permitted to be given under this
agreement shall be in writing and shall be delivered by hand or sent by
certified mail addressed to Xxxxxx at her address set forth in the first
paragraph of this Agreement, with a copy to Xxxxxxx X. Xxxxxx, Esq., Xxxxx,
Xxxxx & XxXxxxxx, P.C. 000 Xxxxxxx Xxxxxx, X.X. Xxx 000, Xxxxxxxxxx, XX
00000-0000 (or such subsequent address as is noted on Company's records), and to
the Company at Xxxxx 00, Xxxxxxxx, XX 00000, with a copy to Xxxxx X. Xxxxx,
Esq., Ledgewood Law Firm, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000,
or to such other address as either of such parties may designate in a written
notice served upon the other party in the manner provided herein. Any such
notice shall become effective upon receipt.
11. Severability. If any term or provision of this Agreement or
the application thereof to any person or circumstance shall, to any extent, be
held invalid or unenforceable by a court of competent jurisdiction, the
remainder of this Agreement or the application of any such term or provision to
persons or circumstances other than those as to which it is held invalid or
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unenforceable, shall not be affected thereby, and each term and provision of
this Agreement shall be valid and enforceable to the fullest extent permitted by
law. If any of the provisions contained in this Agreement shall for any reason
be held to be excessively broad as to duration, scope, activity or subject, it
shall be construed by limiting and reducing it, so as to be valid and
enforceable to the extent compatible with the applicable law or the
determination by a court of competent jurisdiction.
12. Binding Effect and Assignability. The rights and obligations of
both parties under this Agreement shall inure to the benefit of and shall be
binding upon their heirs, successors and assigns, but it shall not be assigned
without the written consent of both parties.
13. Entire Agreement. This instrument constitutes the entire
agreement with respect to the subject matter hereof between the parties hereto
and replaces and supersedes as of the date hereof any and all prior oral or
written agreements and understandings between the parties hereto. This Agreement
may only be modified by an agreement in writing executed by both Xxxxxx and the
Company.
IN WITNESS WHEREOF, the undersigned have executed this Agreement the
date and year written above.
Vermont Pure Holdings, Ltd.
By:\S\Xxxxxxx X. Xxxxxx By: \S\Xxx Xxxxxx
Xxxxxxx X. Xxxxxx Xxx Xxxxxx
President & CEO 1/5/98
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