CONSULTANT AGREEMENT
This Consultant Agreement is entered into by and between ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
("▇▇▇▇▇▇▇") and Oakley, Inc., a Washington corporation ("Oakley") on this 1st
day of August, 1997.
WHEREAS, ▇▇▇▇▇▇▇ owns Oakley stock of substantial value and has been
employed by Oakley for many years in the capacity of Chief Executive Officer
or Vice-president;
WHEREAS, the parties previously entered into an Employment Agreement that
expired on July 31, 1997;
WHEREAS, ▇▇▇▇▇▇▇ will continue to be an employee and act as Vice-Chairman
of Oakley pursuant to an agreement between Oakley and ▇▇▇▇▇▇▇;
WHEREAS, the parties desire, however, to enter into a Consulting Agreement
and set forth their mutual obligations herein.
NOW, THEREFORE, in consideration of the mutual agreements hereinafter set
forth, ▇▇▇▇▇▇▇ and Oakley have agreed and do hereby agree as follows:
1. EMPLOYMENT WITH OAKLEY. The parties agree that ▇▇▇▇▇▇▇ will continue
as an employee and Vice-Chairman of Oakley on such terms and conditions as the
parties may mutually agree and that said employment will be terminable at
will.
2. CONSULTING AGREEMENT. Upon the termination of ▇▇▇▇▇▇▇'▇ employment
with Oakley for any reason other than death or disability, Oakley shall have
the option, which shall be exercisable by Oakley within 30 days of the
effective date of ▇▇▇▇▇▇▇'▇ termination with Oakley, to enter into an
amendment to this agreement, reasonably satisfactory to Oakley and ▇▇▇▇▇▇▇,
that further defines the consulting services which ▇▇▇▇▇▇▇ shall render to
Oakley as mutually agreed upon by ▇▇▇▇▇▇▇ and Oakley. The term of the
consulting period under this Agreement, as so amended, shall begin on the date
of exercise (the "Exercise Date") of the option by Oakley and shall continue
until the later of August 1, 2002 and two years from the Exercise Date (such
later date, the "Expiration Date"). In return for said consulting services,
▇▇▇▇▇▇▇ shall be compensated at the rate of $100,000.00 per year payable in
equal bi-weekly installments or at such other time or times as ▇▇▇▇▇▇▇ and
Oakley shall agree.
It is expressly understood that ▇▇▇▇▇▇▇'▇ reporting obligations pursuant to
this Consulting Agreement shall be limited to the Chairman of the Board of
Directors of Oakley or such other person as ▇▇▇▇▇▇▇ and Oakley shall agree.
3. ASSIGNMENT OF INTELLECTUAL PROPERTY RIGHTS.
(a) DEFINITION OF "INVENTIONS". As used herein, the term
"Inventions" shall mean all designs, inventions, discoveries, improvements,
trade secrets, formulas, techniques, data, programs, systems, specifications,
documentation, algorithms, flow charts, logic diagrams, source codes,
processes, and other information, including works-in-progress, whether or not
subject to patent, trademark, copyright, trade secret, or mask work
protection, and whether or not reduced to practice, which are made, created,
authored, conceived, or reduced to practice by ▇▇▇▇▇▇▇, either alone or
jointly with others, during the period of employment or consulting with Oakley
(including, without limitation, all periods of employment with Oakley prior to
the effective date) which (A) relate to the actual or anticipated business,
activities, research, or investigations of Oakley or (B) result directly or
indirectly from work performed by ▇▇▇▇▇▇▇ for Oakley (whether or not made or
conceived during normal working hours or on the premises of Oakley), or (C)
which result, to any extent, from use of Oakley's premises or property.
(b) WORK FOR HIRE. ▇▇▇▇▇▇▇ expressly acknowledges that all
copyrightable aspects of the Inventions (as defined below) are to be
considered "works made for hire" within the meaning of the Copyright Act of
1976, as amended (the "Act"), and that Oakley is to be the "author" within the
meaning of such Act for all purposes. All such copyrightable works, as well as
all copies of such works in whatever medium fixed or embodied, shall be owned
exclusively by Oakley as of its creation, and ▇▇▇▇▇▇▇ hereby expressly
disclaims any and all interest in any of such copyrightable works and waives
any right of DROIT MORALE or similar rights.
(c) ASSIGNMENT. ▇▇▇▇▇▇▇ acknowledges and agrees that all Inventions
constitute trade secrets of Oakley and shall be the sole property of Oakley or
any other entity designated by Oakley. In the event that title to any or all
of the Inventions, or any part or element thereof, may not, by operation of
law, vest in Oakley, or such Inventions may be found as a matter of law not to
be "works made for hire" within the meaning of the Act, ▇▇▇▇▇▇▇ hereby conveys
and irrevocably
assigns to Oakley, without further consideration, all his right, title and
interest, throughout the universe and in perpetuity, in all Inventions and all
copies of them, in whatever medium fixed or embodied, and in all written
records, graphics, diagrams, notes, or reports relating thereto in ▇▇▇▇▇▇▇'▇
possession or under his control, including, with respect to any of the
foregoing, all rights of copyright, patent, trademark, trade secret, mask
work, and any and all other proprietary rights therein, the right to modify
and create derivative works, the right to invoke the benefit of any priority
under any international convention, and all rights to register and renew same.
(d) PROPRIETARY NOTICES; NO FILINGS; WAIVER OF MORAL RIGHTS.
▇▇▇▇▇▇▇ acknowledges that all Inventions shall, at the sole option of Oakley,
bear Oakley's patent, copyright, trademark, trade secret, and mask work
notices.
▇▇▇▇▇▇▇ agrees not to file any patent, copyright, or trademark
applications relating to any Invention, except with prior written consent of
an authorized representative of Oakley (other than ▇▇▇▇▇▇▇).
▇▇▇▇▇▇▇ hereby expressly disclaims any and all interest in any Inventions
and waives any right of droit morale or similar rights, such as rights of
integrity or the right to be attributed as the creator of the Invention.
(e) FURTHER ASSURANCES. ▇▇▇▇▇▇▇ agrees to assist Oakley, or any
party designated by Oakley, promptly on Oakley's request, whether before or
after the termination of employment, however such termination may occur, in
perfecting, registering, maintaining, and enforcing, in any jurisdiction,
Oakley's rights in the Inventions by performing all acts and executing all
documents and instruments deemed necessary or convenient by Oakley, including,
by way of illustration and not limitation:
i) Executing assignments, applications, and other documents
and instruments in connection with (A) obtaining patents, copyrights,
trademarks, mask works, or other proprietary protections for the
Inventions and (B) confirming the assignment to Oakley of all right,
title, and interest in the Inventions or otherwise establishing Oakley's
exclusive ownership rights therein.
ii) Cooperating on the prosecution of patent, copyright,
trademark and mask work applications, as well as
in the enforcement of Oakley's rights in the Inventions, including, but
not limited to, testifying in court or before any patent, copyright,
trademark or mask work registry office or any other administrative body.
▇▇▇▇▇▇▇ will be reimbursed for all out-of-pocket costs incurred in
connection with the foregoing, if such assistance is requested by Oakley
after the termination of ▇▇▇▇▇▇▇'▇ employment. In addition, to the extent
that, after the termination of employment for whatever reason, ▇▇▇▇▇▇▇'▇
technical expertise shall be required in connection with the fulfillment
of the aforementioned obligations, Oakley will compensate ▇▇▇▇▇▇▇ at a
reasonable rate for the time actually spent by ▇▇▇▇▇▇▇ at Oakley's request
rendering such assistance.
(f) POWER OF ATTORNEY. ▇▇▇▇▇▇▇ hereby irrevocably appoints Oakley
to be his Attorney-In-Fact to execute any document and to take any action in
his name and on his behalf and to generally use his name for the purpose of
giving to Oakley the full benefit of the assignment provisions set forth above.
(g) DISCLOSURE OF INVENTIONS. ▇▇▇▇▇▇▇ will make full and prompt
disclosure to Oakley of all Inventions subject to assignment to Oakley, and
all information relating thereto in ▇▇▇▇▇▇▇'▇ possession or under his control
as to possible applications and use thereof.
4. NO VIOLATION OF THIRD-PARTY RIGHTS.
▇▇▇▇▇▇▇ represents, warrants, and covenants that he:
(a) will not, in connection with his activities hereunder, knowingly
infringe upon or violate any proprietary rights of any third party (including,
without limitation, any third party confidential relationships, patents,
copyrights, mask works, trade secrets, or other proprietary rights);
(b) is not a party to any conflicting agreements with third parties
which will prevent him from fulfilling the terms of employment and the
obligations of this Agreement;
(c) does not have in his possession any confidential or proprietary
information or documents belonging to others and will not disclose to Oakley,
use, or induce Oakley to use, any
confidential or proprietary information or documents of others; and
(d) agrees, in connection with any of his activities hereunder to
respect any and all valid obligations which he may now have to prior employers
or to others relating to confidential information, inventions, or discoveries
which are the property of those prior employers or others, as the case may be.
▇▇▇▇▇▇▇ agrees to indemnify and save harmless Oakley from any loss, claim,
damage, cost or expense of any kind (including without limitation, reasonable
attorney fees) to which Oakley may be subjected by virtue of a breach by
▇▇▇▇▇▇▇ of the foregoing representations, warranties, and covenants.
5. CONFIDENTIAL INFORMATION AND NON-COMPETITION.
(a) CONFIDENTIALITY. ▇▇▇▇▇▇▇ acknowledges that in his employment as
a consultant hereunder, and during prior periods of employment with Oakley, he
has occupied and will continue to occupy a position of trust and confidence.
▇▇▇▇▇▇▇ shall not, except as may be required to perform his duties hereunder
or as required by applicable law, without limitation in time or until such
information shall have become public other than by ▇▇▇▇▇▇▇'▇ unauthorized
disclosure, disclose to others or use, whether directly or indirectly, any
Confidential Information regarding Oakley. "Confidential Information" shall
mean information about Oakley, its subsidiaries and affiliates, and their
respective clients and customers that is not disclosed by Oakley for financial
reporting purposes and that was learned by ▇▇▇▇▇▇▇ in the course of his
employment by Oakley, including (without limitation) any proprietary
knowledge, trade secrets, data, formulae, information and client and customer
lists and all papers, resumes, and records (including computer records) of the
documents containing such Confidential Information. ▇▇▇▇▇▇▇ acknowledges that
such Confidential Information is specialized, unique in nature and of great
value to Oakley, and that such information gives Oakley a competitive
advantage. Oakley agrees to (i) deliver or return to Oakley, at Oakley's
request at any time or upon termination or expiration of his employment or as
soon thereafter as possible, (A) all documents, computer tapes and disks,
records, lists, data, drawings, prints, notes and written information (and all
copies thereof) furnished by Oakley or prepared by ▇▇▇▇▇▇▇ during the term of
his employment by Oakley and (B) all notebooks and other data relating to
research or experiments or other work conducted by ▇▇▇▇▇▇▇ in the scope
of employment or any Inventions made, created, authored, conceived, or reduced
to practice by ▇▇▇▇▇▇▇, either alone or jointly with others, and (ii) make
full disclosure relating to any Inventions.
If ▇▇▇▇▇▇▇ would like to keep certain property, such as material relating
to professional societies or other non-confidential material, upon the
termination of employment with Oakley, he agrees to discuss such issues with
Oakley. Where such a request does not put Confidential Information of Oakley
at risk, Oakley will grant the request. In this regard, Oakley hereby grants
▇▇▇▇▇▇▇ the right to keep his personal copy of the black "bound books", which
chronicle the financial history of Oakley.
(b) NON-COMPETITION. During the term of his employment and, if
Oakley exercises the option contained in Section 2, through the Expiration
Date, ▇▇▇▇▇▇▇ shall not directly or indirectly, without the prior written
consent of Oakley, provide consultative services or otherwise provide services
to (whether as an employee or a consultant, with or without pay), own, manage,
operate, join, control, participate in, or be connected with (as a
stockholder, partner, or otherwise), any business, individual, partner, firm,
corporation, or other entity that is then a competitor of Oakley, including
any entity engaged in the design, manufacture and/or distribution of eyewear
(each such competitor a "Competitor of Oakley"); provided, however, that the
"beneficial ownership" by ▇▇▇▇▇▇▇, either individually or as a member of a
"group," as such terms are used in Rule 13d of the General rules and
Regulations under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), of not more than five percent (5%) of the voting stock of any
publicly held corporation shall not alone constitute a violation of this
Agreement. It is further expressly agreed that Oakley will or would suffer
irreparable injury if ▇▇▇▇▇▇▇ were to compete with Oakley or any subsidiary or
affiliate of Oakley in violation of this Agreement and that Oakley would by
reason of such competition be entitled to injunctive relief in a court of
appropriate jurisdiction, and ▇▇▇▇▇▇▇ further consents and stipulates to the
entry of such injunctive relief in such a court prohibiting ▇▇▇▇▇▇▇ from
competing with Oakley or any subsidiary or affiliate of Oakley in violation of
this Agreement. ▇▇▇▇▇▇▇ and Oakley acknowledge and agree that the business of
Oakley is global in nature, and that the terms of the non-competitive
agreement set forth herein shall apply on a worldwide basis.
(c) NON-SOLICITATION OF CUSTOMERS AND SUPPLIERS. During the term of
his employment and, if Oakley exercises the option contained in Section 2,
through the Expiration Date, ▇▇▇▇▇▇▇ shall not, directly or indirectly,
influence or attempt to influence customers or suppliers of Oakley or any of
its subsidiaries or affiliates, to divert their business to any Competitor of
Oakley.
(d) NON-SOLICITATION OF EMPLOYEES. ▇▇▇▇▇▇▇ recognizes that he
possesses and will possess confidential information about other employees of
Oakley relating to their education, experience, skills, abilities,
compensation and benefits, and inter-personal relationships with customers of
Oakley. ▇▇▇▇▇▇▇ recognizes that the information he possesses and will possess
about these other employees is not generally known, is of substantial value to
Oakley in developing its business and in securing and retaining customers, and
has been and will be acquired by him because of his business position with
Oakley. ▇▇▇▇▇▇▇ agrees that, during the term of his employment and, if Oakley
exercises the option contained in Section 2, through the Expiration Date, he
will not, directly or indirectly, solicit or recruit any employee of Oakley
for the purpose of being employed by him or by any Competitor of Oakley on
whose behalf he is acting as an agent, representative or employee and that he
will not convey any such confidential information or trade secrets about other
employees of Oakley to any other person.
(e) SURVIVAL OF PROVISIONS. The obligations contained in this
section shall survive the expiration of the consulting agreement hereunder and
shall be fully enforceable thereafter. If it is determined by a court of
competent jurisdiction in any state that any restriction in this section is
excessive in duration or scope or is unreasonable or unenforceable under the
laws of that state, it is the intention of the parties that such restriction
may be modified or amended by the court to render it enforceable to the
maximum extent permitted by the law of that state.
6. FRINGE BENEFITS. As provided in the parties' previous Employment
Agreement, from and after the date of ▇▇▇▇▇▇▇'▇ termination of employment with
Oakley (including the term of the Consulting Agreement), ▇▇▇▇▇▇▇ shall be
entitled during his lifetime, to full company paid medical and health
insurance for himself and his immediate family at a level no less favorable
than that in effect for the benefit of Oakley's senior executive officers.
7. PRODUCTS. From and after the date of ▇▇▇▇▇▇▇'▇ termination of
employment with Oakley (including the term of the Consulting Agreement),
▇▇▇▇▇▇▇ shall be entitled, during his lifetime, to purchase from Oakley, at
employee prices, any and all Oakley products in an annual amount of $25,000.00.
8. NOTICES. All notices and other communications under this Agreement
shall be in writing and shall be given by fax or first class mail, certified
or registered with return receipt requested, and shall be deemed to have been
duly given three (3) days after mailing or twenty-four (24) hours after
transmission of a fax to the respective persons named below:
If to Oakley: Oakley, Inc.
One Icon
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTENTION: Secretary
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to ▇▇▇▇▇▇▇: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
c/o Oakley, Inc.
One Icon
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Either party may change such party's address for notices by notice duly given
pursuant hereto.
9. TERMINATION OF PRIOR AGREEMENTS. This Agreement terminates and
supersedes any and all prior agreements and understandings between the parties
with respect to ▇▇▇▇▇▇▇'▇ employment and compensation by Oakley.
10. ASSIGNMENT; SUCCESSORS. This Agreement is personal in its nature and
neither of the parties hereto shall, without the consent of the other, assign
or transfer this Agreement or any rights or obligations hereunder; provided
that, in the event of the merger, consolidation, transfer, or sale of all or
substantially all of the assets of Oakley with or to any other individual or
entity, this Agreement shall, subject to the provisions hereof, be binding
upon and inure to the benefit of such successor and such successor shall
discharge and perform all of the promises, covenants, duties and obligations
of Oakley hereunder.
11. GOVERNING LAW. This Agreement and the legal relations thus created
between the parties hereto shall be governed by and construed under and in
accordance with the laws of the State of California.
12. WAIVER; MODIFICATION. Failure to insist upon strict compliance with
any of the terms, covenants, or conditions hereof shall not be deemed a waiver
of such term, covenant, or condition, nor shall any waiver or relinquishment
of, or failure to insist upon strict compliance with, any right or power
hereunder at any one or more times be deemed a waiver or relinquishment of
such right or power at any other time or times. This Agreement shall not be
modified in any respect except by a writing executed by each party hereto.
13. SEVERABILITY. In the event that a court of competent jurisdiction
determines that any portion of this Agreement is in violation of any statute
or public policy, only the portions of this Agreement that violate such
statute or public policy shall be stricken. All portions of this Agreement
that do not violate any statute or public policy shall continue in full force
and effect. Further, any court order striking any portion of this Agreement
shall modify the stricken terms as narrowly as possible to give as much effect
as possible to the intentions of the parties under this Agreement.
14. INDEMNIFICATION. Oakley shall indemnify and hold ▇▇▇▇▇▇▇ harmless for
acts and omissions in his capacity as an officer, director, employee or
consultant of Oakley as provided in the separate written indemnification
agreement between Oakley and ▇▇▇▇▇▇▇.
IN WITNESS WHEREOF, Oakley has caused this Consulting Agreement to be
executed by its duly authorized officer and ▇▇▇▇▇▇▇ has hereunto signed this
Agreement as of the date first above written.
OAKLEY, INC. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
BY: _________________________
ITS: ________________________