EXHIBIT 10.23
Employment Agreement between Registrant and
Xxxxxxxx Xxxxx made as of December 7, 1999
Employment Agreement
Agreement made as of the 7th day of December 1999 between The Lamaur
Corporation, a Delaware Corporation, with offices at 0000 X. Xxxxx Xxxx,
Xxxxxxx, XX 00000, (hereinafter referred to as Company) and Xxxxxxxx Xxxxx
residing at 000 Xxxxx Xxxxxxx, Xxxxxx Xxxxxxx, XX 00000 (hereinafter referred to
as Employee).
1. Employment and Duties: The Company, a public Corporation, hereby employs
Employee as the Chief Executive Officer of Company to perform Executive duties
generally accepted as the duties such titles entail. Such duties will include,
but not be limited to: managing the Company's resources to achieve
stabilization, growth and profit goals; developing 1-year Operating Plans and
3-to-5 year Business Plans; and managing the implementation of defined
strategies and tactics to achieve near-term and long-range objectives with focus
on increasing shareholder value. In addition, Employee has been elected to the
Company's Board of Directors and will serve as the Chairman of the Board.
2. Performance: Employment shall commence on December 7, 1999. Employee shall
devote all or such part of his time to the performance of his duties described
in paragraph 1 above and to the performance of such other Executive duties as
may be assigned to him from time to time by the majority of Directors of the
Company. Acceptable performance of Employee is based on the judgement of the
majority of the Company's Board and/or achievement of defined milestones such as
those defined herein and/or profit goals specified in the Company's Board
approved 1-year operating plan and/or long-term business plan.
The Company's Board of Directors shall have the right to terminate Employee at
any time during the term of this Agreement, as long as all provisions of the
Agreement are fulfilled by the Company to the Employee to the end of the
Agreement term. However, in the event the Company terminates this agreement
because Employee has been convicted of a felony, or any intentional fraud
against the Company, the Company shall have no further obligations to Employee
(whether stock, salary, or bonus). If Employee should voluntarily terminate
employment prior to the end of the term of the Agreement, Employee shall have
prorated rights only to vested portions of stock options and no further rights
to unvested stock options. Additionally, Employee shall be entitled to the
prorated share only of any earned bonus as identified in paragraph five herein.
3. Term: The term of this Agreement for Company and Employee shall be two years
and 24 days (i.e. commencing on Dec. 7, 1999 and ending on Dec. 31, 2001). At
the end of such term, the agreement, with the exception of the granting of
further stock, shall be automatically renewed for periods of one year each,
unless notice is given by either party at least one year before the end of the
agreement and one year before the end of subsequent renewals.
4. Compensation: For services to be rendered by Employee in his capacity as
Chairman of the Board and Chief Executive Officer, Company agrees to pay
Employee a salary of $75,000 per annum, payable in equal semi-monthly
installments. Employee shall be granted common stock options pursuant to the
Company's Stock Option Plan and is subject to the execution of the Company's
stock option agreement under that plan. Stock options granted shall total
600,000 authorized and registered shares. Stock option price shall be 12.5 cents
per share. Vesting of total stock options shall occur monthly during the term of
this agreement commencing on January 31, 2000 in equal installments of 25,000
shares.
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In the event of newly authorized shares issued by the Company, Employee shall be
granted additional and similar stock options as per the original grant in order
to maintain Employee's same percentage of total shares. No other operating
Executive shall be entitled to receive more stock option shares than Employee
during the term of this agreement. This provision shall not apply at any time
following the termination of Employee's employment for any reason.
Employee shall have the right to exercise vested stock options at any time
through two years after the termination of this agreement. If employee desires
to sell all or a portion of vested options, Company may at its discretion,
purchase vested stock options at market price as quoted by NASDAQ on the day of
the transaction.
Employee and his family shall be provided the standard benefits under the
Company's existing and future health, medical and other employee benefit plans
made available to the Company's salaried, non-union employees. Employee shall be
entitled to four weeks vacation.
5. Bonus: In addition to the base compensation described above, Company agrees
to pay Employee an additional sum in the amount of $25,000 within sixty days
following the first operating quarter in which Company attains breakeven in
profit before taxes and legal expenses as defined herein. Additionally, Company
agrees to provide an annual bonus of 5.0% of the profit before taxes and legal
expenses as defined herein, of the Company to Employee, payable no later than 60
days after the end of the fiscal Year. The determination of whether there is a
profit before taxes shall be made in accordance with generally accepted
accounting principles. However, any professional legal fees incurred by the
Company related to the Parsow Litigation, Xxxxxxxx Xxxxxx Xxxx claim, trade
creditors and/or employee severance situations will be excluded from such
calculation. Confirmation of bonus compensation shall be made by Deloitte,
Touche, the Company's auditors or other such auditors then regularly employed by
the Company, and the determination of such auditor shall be binding on the
parties to this agreement.
6. Expenses: In addition to the compensation provided in paragraph 4 hereof,
Company will pay Employee such sums so as to reimburse Employee for reasonable
expenses incurred in the performance of his duties. These shall include, but not
be limited to, travel, hotel or lodging, meals, car rental and other such
miscellaneous expenses in connection with his duties. Additionally, if Employee
elects to lease or buy a vehicle, the Company will reimburse the monthly cost of
such vehicle, its operating expenses and the tax liability incurred, such
allowance not to exceed $1,000 per month.
7. Death: In the event of Employee's death or disability during the term of this
Agreement or subsequent renewals, this Agreement shall terminate immediately
except that Employee's family shall be entitled to receive the then current
compensation, excluding additional stock options, for a period of six months
from death or disability after the last day of the month in which death
occurred. Additionally, Employee's Estate via its legal representatives shall be
entitled to the prorata share of any bonuses earned in the year of Employee's
death. Employee's legal representatives shall also have the right to exercise
all vested stock options within the six-month period after death for the benefit
of Employee's Estate.
8. Relocation: During the term of this Agreement or during subsequent renewal
periods, Employee shall not be required to relocate to the area of the Company's
corporate offices without his agreement, and Company will continue to reimburse
employee for expenses as described in paragraph 6 throughout the term of this
Agreement.
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9. Director's and Officers Liability Insurance: Company agrees to maintain a
policy in force providing no less than $5 million in liability insurance.
Company additionally agrees to indemnify Employee from any personal liability
occurring as a result of legal actions against the Company including the payment
of all legal expenses related to such action.
10. Effect of waiver: The waiver by either party of a breach of any provision of
this Agreement shall not be construed a waiver of any subsequent breach thereof.
This agreement contains the entire contractual understanding of the parties and
may not be changed orally but only by a written instrument signed by the parties
thereto.
11. Arbitration: Minnesota law shall be applicable to this contract and any
controversy arising from, or related to this Agreement shall be determined by
arbitration in the city of Minneapolis or other such location as mutually
agreeable in accordance with the Rules of the American Arbitration Association,
and judgment upon any such determination or award may be entered in any court
having jurisdiction.
12. Transfer of Ownership or Control: In the event of transfer of ownership or
control of the Company or its assets, this Agreement shall be binding on the new
controlling interests or entity except that the then unvested stock options
shall become immediately vested.
13. Entire Agreement: This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
negotiations and agreements, whether written or oral.
14. Notices: Any and all notices referred to herein shall be sufficient if
furnished in writing, sent by registered mail or Fedex to the respective
addresses noted above or other such addresses as may be given by the parties in
writing in the future.
In witness whereof, the parties hereto have caused this Agreement to be executed
by its duly authorized Director and its corporate seal to be hereunto affixed,
the day and year indicated above.
/s/ Xxxxxx X. Xxxxxxxxx /s/ Xxxxxxxx Xxxxx
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Xxxxxx X. Xxxxxxxxx, Director Xxxxxxxx Xxxxx
For the Lamaur Board of Directors Employee
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