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EMPLOYMENT AGREEMENT
DATED AS OF NOVEMBER __, 1996
BETWEEN
STYLING TECHNOLOGY CORPORATION
AND
XXXXXX X. XXXXX
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made this ____ day of
November, 1996, by and between STYLING TECHNOLOGY CORPORATION, a Delaware
corporation (hereinafter called "Employer") and XXXXXX X. XXXXX (hereinafter
called ("Employee").
W I T N E S S E T H:
A. Employer has entered into a stock purchase agreement providing for
Employer to acquire Kotchammer Investments, Inc., dba Styling Research Company
("SRC"), (the "Acquisition").
B. Employer desires to employ Employee and Employee desires to accept
such employment, all on the terms and conditions set forth in this Agreement
effective on the consummation of the Acquisition (the "Effective Date").
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. On the Effective Date, Employer shall employ Employee,
and Employee shall accept such employment, as Vice President of the SRC Division
of Employer 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. Commencing on the Effective Date, Employee
shall devote Employee's entire business time, attention and efforts to the
performance of Employee's duties under this Agreement, and 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. Commencing on the Effective Date, Employer shall
pay to Employee, as full compensation for the services rendered by Employee,
during Employee's employment under this Agreement, a salary at a rate of
$114,000 per annum to be paid in equal monthly installments, or in such other
periodic installments upon which Employer and Employee shall mutually agree.
(b) ANNUAL BONUS. For each calendar year during Employee's
employment under this Agreement including calendar 1996, Employer shall consider
the payment to Employee of a bonus with the amount of any bonus to be determined
by the Board of Directors of Employer based upon performance standards
established by the Board of Directors of Employer. Neither Employee, to the
extent Employee is a member of the Board of Directors
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of Employer, nor any other employee of Employer who is a member of such Board of
Directors, shall participate in any deliberations or vote on any such bonus with
the amount of such bonus, if any, to be determined by the majority of the other
directors of Employer. The bonus for any calendar year during Employee's
employment under this Agreement shall be paid to Employee within 120 days after
the end of such calendar year; provided, however, no bonus shall be payable if
Employee leaves the employ of Employer prior to the payment of any such bonus
for any reason other than death or disability.
(c) STOCK OPTION PROGRAM. In the event Employer adopts a
management incentive Stock Option Program, Employee shall be eligible to
participate in such Program provided that such participation shall be at the
sole discretion of Employer's Board of Directors.
(d) INSURANCE AND OTHER BENEFITS. During the term of
Employee's Employment under this Agreement,
(i) Employee shall be entitled to participate in or
receive benefits under all employee and executive benefit plans or arrangements
and perquisites of employment, including without limitation, plans or
arrangements providing for health and disability insurance coverage, life
insurance for the benefit of Employee's beneficiaries, deferred compensation and
pension benefits, incentive stock option plans, all at the highest level that is
available through Employer to other employees at Employee's level subject to the
same terms and conditions as apply to such other employees.
(ii) Employee shall be entitled to receive not less
than three weeks paid vacation per year.
4. TERM OF EMPLOYMENT.
(a) EMPLOYMENT TERM. The term of Employee's employment
hereunder shall commence on the Effective Date and shall continue for one year
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) Employee's employment shall be automatically
terminated, without notice, effective upon the date of Employee's death;
(ii) If Employee shall fail, for a period of more
than 30 consecutive days, or for 30 days within any 60 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, upon notice to Employee, terminate
Employee's employment effective on the date of that notice;
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(iii) Employer may, at its option, upon notice to
Employee, terminate Employee's employment effective on the date of that notice.
(iv) Employee may, at his option, upon notice to
Employer, terminate Employee's employment effective on the date of that notice.
(v) If Employee shall breach or violate any of the
provisions of this Agreement, or fail to perform in a manner reasonably
satisfactory to Employer any of the duties required of Employee and such breach,
violation or failure shall continue for a period of 10 days after Employer shall
have given Employee written notice specifying the nature thereof in reasonable
detail, Employer may, at its option, upon notice to Employee, terminate
Employee's employment effective on the date of that notice.
(vi) If Employee engages in an act or acts involving
a crime, moral turpitude, fraud or dishonesty, Employer may, at its option, upon
notice to Employee, terminate Employee's employment effective on the date of
that notice.
(c) RESULT OF TERMINATION. In the event of the termination of
Employee's employment pursuant to paragraphs 4(b)(i) above, this Agreement and
Employee's employment hereunder shall terminate as of the date of the death of
Employee, and his estate or personal representative shall be entitled to receive
fixed salary prorated through the date of Employee's death. In the event of the
termination of Employee's employment pursuant to paragraph 4(b)(iii) above,
Employee shall continue to receive Employee's fixed compensation through the
six-month period commencing on the first day of the month next following the
date of termination. In the event of the termination of Employee pursuant to
paragraph 4(b)(ii), (iv), (v) or (vi) above, Employee shall receive no further
compensation under this Agreement.
5. COMPETITION AND CONFIDENTIAL INFORMATION.
(a) INTERESTS TO BE PROTECTED. The parties acknowledge that
during the term of Employee's employment with Employer, Employee will perform
essential services for Employer. Employee will be exposed to, have access to,
and be required to 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 if Employer must hire new personnel or retrain existing personnel to
fill vacancies, it will incur substantial expense in recruiting and training
such personnel. The parties expressly recognize that should Employee compete
with Employer in any manner whatsoever, it could seriously impair the good will
and diminish the value of Employer's business. 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
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reasonable and are freely, voluntarily and knowingly entered into. 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 a period of the same duration as the length of Employee's
employment with Employer (but in no event less than six months nor greater than
36 months) after the expiration or 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 or solicit, canvas or accept, or authorize any
other person, firm or entity to solicit, canvas or accept, from any customers of
Employer, any business within the Restricted Territory for Employee or for any
other person, firm or entity. As used herein, customers of Employer shall mean
any persons, firms or entities that purchased goods or services from Employer
during the period of Employee' s employment with Employer; competitive business
shall mean any business which 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; and the Restricted Territory shall mean
any area in which Employer conducts business.
(c) NON-SOLICITATION OF EMPLOYEES. During the term of
Employee's employment and for a period of 36 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(s), company, partnership, corporation, or
governmental entity, seek to hire, and/or hire any of Employer's personnel or
employees for the purpose of having such employee engage in services that are
the same, 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 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 trade secrets, knowledge or information with respect to
processes, inventions, formulae, machinery, manufacturing techniques or
know-how; 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 purchasing, sales or distribution 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 catalogues, manuals, memoranda, drawings, and
specifications; all cost, pricing and other
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financial data; all customer information; all other written or printed materials
which are the property of Employer (and any copies of them); and all other
materials which 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 discoveries and
improvements, whether patentable or not, which 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 paragraph 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 subparagraph (a), (d) or (e) of this paragraph,
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. Each and every restriction set
forth in this paragraph is independent and severable from the others, and no
such restriction shall be rendered 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 when delivered
against receipt or when deposited in the United States mails, first class
postage prepaid, addressed as set forth below:
(i) If to Employer:
Xxx Xxxx Xxxxxxxxx Xxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxxxxx
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with a copy to:
X'Xxxxxx, Cavanagh, Anderson,
Xxxxxxxxxxxxx & Xxxxxxxx, P.A.
Xxx Xxxx Xxxxxxxxx Xxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxx, Esq.
(ii) If to Employee:
Xxxxxx X. Xxxxx
_________________________________
_________________________________
with a copy to:
Attention: ______________________
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 paragraph for the giving of notice.
(b) INDULGENCES. 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.
(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.
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(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 which is not a Saturday, Sunday or holiday.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
EMPLOYER:
STYLING TECHNOLOGY CORPORATION
By: ________________________________
Name: ______________________________
Its: _______________________________
EMPLOYEE:
____________________________________
Xxxxxx X. Xxxxx
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