Document:

ex101.htm

Exhibit 10.1

 

EXECUTION COPY

 

SEPARATION AND RELEASE OF CLAIMS AGREEMENT

 

THIS SEPARATION AND RELEASE OF CLAIMS AGREEMENT (this “Agreement”) is made and entered into as of this 28th day of September, 2012, by and between ROBERT G. PEDERSEN II (“Consultant”) and ZAGG INC, a Nevada corporation with its principal place of business in Salt Lake County, Utah (the “Company”).

 

RECITALS

 

WHEREAS, Consultant was previously employed by the Company as its Chief Executive Officer, having resigned on August 17, 2012 (the “Resignation Date”) as its Chief Executive Officer and as the Chairman of its Board of Directors;

 

WHEREAS, the Company wishes to hire Consultant to serve as an executive consultant under the terms of an Executive Consulting Agreement (the “Consulting Agreement”), to which this Agreement is attached as Exhibit A;

 

WHEREAS, the Company and Consultant desire to resolve any and all differences regarding Consultant’s employment, the termination of Consultant’s employment, and all other matters.

 

NOW THEREFORE, in consideration of the mutual promises hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Consultant agree as follows:

 

AGREEMENT

 

1.            TERMINATION OF EMPLOYMENT RELATIONSHIP. Consultant hereby acknowledges and affirms his resignation, effective as of the Resignation Date, as a member and Chairman of the Board of Directors and as Chief Executive Officer of the Company, from any and all other roles or positions within the Company, and as an officer, director, or employee of, or from any and all other roles or positions within, any subsidiary or affiliate of the Company, excluding HzO, Inc, where he shall continue to serve at the pleasure of the Company.

 

2.            PAYMENT OF COMPENSATION THROUGH THE RESIGNATION DATE. Consultant acknowledges and agrees that he has received all (i) salary, commissions, bonuses and other compensation owed to him through the Resignation Date, and (ii) all reimbursable business expenses.

 

3.            PAYMENT FOR ACCRUED VACATION LEAVE. Consultant acknowledges and agrees that he was not entitled to payment for unused accrued vacation leave, sick leave or PTO leave as of the Resignation Date.

 

4.            CONSULTING AGREEMENT. In consideration of Consultant signing this Agreement, and the covenants and releases given herein, the Company will contract with Consultant to provide consulting services pursuant to the terms of the Consulting Agreement. Consultant acknowledges that he would not be given a contract to work as a consultant for the Company absent his unrevoked consent to this Agreement. If Consultant revokes this Agreement following its execution, within the time permitted under this Agreement, Consultant acknowledges and agrees that the Company shall not be bound by any of its obligations under the Consulting Agreement.

 

 

  

1

  

 

 

5.             CONTINUING COVENANTS. Consultant hereby agrees to continue to abide by Consultant’s duties and obligations contained in sections 2 – 4 and 7 - 10 the Employment Agreement agreed to while Consultant was the Chief Executive Officer and the Chairman of its Board of Directors of the Company, an unsigned copy of which is attached hereto as Exhibit B  (the “Employee Agreement”), including but not limited to the covenants and obligations related to confidentiality and nondisclosure, assignment of Employee Inventions (as such term is defined in the Employee Agreement) and works for hire, and noncompetition. Consultant also agrees to return to the Company on or before September 30, 2012, any and all Company property and/or Confidential Information (as such term is defined in the Employee Agreement) that still is in Consultant’s possession, custody or control, excluding the [2010] Harley Davidson motorcycle, Serial No. [___________], and the laptop computers and iPads that the Company previously agreed the Consultant could retain.

 

6.             OTHER OBLIGATIONS AND RIGHTS; CERTAIN REPRESENTATAIONS.

 

6.01 The Company will pay for Consultant’s normal and customary cell phone charges for a period of two (2) years after the Resignation Date. Consultant will have the use of his robert@zagg.com email address for a period of two (2) years after the Resignation Date.

 

6.02 Consultant’s 53,333 unvested restricted stock award dated March 2, 2011 shall vest 26,666 shares on March 2, 2013, and 26,667 shares on August 17, 2013, each subject to Consultant’s continued service under the Consulting Agreement. Consultant’s 31,666 unvested options dated February 5, 2010 shall vest on February 5, 2013 subject to Consultant’s continued service under the Consulting Agreement. Consultant’s 73,958 unvested restricted stock award dated January 30 ̧ 2012 shall continue to vest pursuant to the terms thereof and subject to Consultant’s continued service under the Consulting Agreement.

 

6.03 Consultant and his affiliates have closed or terminated all margin loan accounts and or any other agreement, arrangement or transaction which would violate the Company’s Short-Term or Speculative Transactions Policy, such as publicly traded options, short sales, puts, calls, and/or hedging transactions.

 

7.             CONSULTANT’S RELEASE OF CLAIMS.

 

7.01   Release of Claims by Consultant.  Consultant individually and on behalf of his heirs, assigns, executors, and successors, and each of them, hereby unconditionally, irrevocably and absolutely releases and discharges the Company, its affiliates and subsidiaries, and their respective shareholders, directors, officers, employees, agents, attorneys, successors and assigns, and any related corporations and/or other entities from any and all duties and obligations directly or indirectly relating to his employment by the Company prior to the Resignation Date. Further, Consultant, individually and on behalf of his heirs, assigns, executors, and successors, and each of them, hereby unconditionally, irrevocably and absolutely releases and discharges the Company, and its respective shareholders, directors, officers, employees, agents, attorneys, successors and assigns, and any related corporations and/or other entities from any and all loss, liability, claims, demands, causes of action or suits of any type, whether known or unknown, liquidated or contingent, that are directly or indirectly related to, based upon, or arise out of, in whole or in part, his employment by or with the Company prior to the Resignation Date, and/or his separation from the Company.

 

7.02   Specific Claims Released. The claims released herein include, without limitation, (a) any claims based either in whole or in part upon any facts, circumstances, acts, or omissions in any way arising out of, based upon, or related to Employee’s employment with the Company or his separation from the Company ; (b) any claims arising under any federal or state statute or regulation, local ordinance, or the common law, regarding employment or prohibiting employment discrimination, harassment, or retaliation, including, without limitation, Title VII of the Civil Rights Act of 1964, the Equal Pay Act, the Age Discrimination in Employment Act, the Older Workers’ Benefit Protection Act, the National Labor Relations Act, Section 1981 of the Civil Rights Act of 1866, the Americans with Disabilities Act, the Fair Labor Standards Act, the Employee Retirement Income Security Act, the Family and Medical Leave Act, the Worker Adjustment and Retraining Notification Act, the Health Insurance Portability and Accountability Act of 1996, the Utah Antidiscrimination Act, and the Utah Payment of Wages Act; (c) any claim for wrongful discharge, wrongful termination in violation of public policy, breach of the covenant of good faith and fair dealing, breach of contract, personal injury, harm, or other damages (whether intentional or unintentional), negligence, negligent employment, defamation, misrepresentation, fraud, intentional or negligent infliction of emotional distress, interference with contract or other economic opportunity, assault, battery, or invasion of privacy; (d) claims growing out of any legal restrictions on the Company’s right to terminate its employment relationship with its employees; (e) claims for wages, other compensation, or benefits; (f) any claim for general, special, or other compensatory damages, consequential damages, punitive damages, back or front pay, fringe benefits, attorneys’ fees, costs, or other damages or expenses; (g) any claim for injunctive relief or other equitable relief; (h) any claim arising under any federal or state statute or local ordinance regulating the health and/or safety of the workplace; or (i) any other tort, contract, or statutory claim.

 

 

  

2

  

 

7.03   Acknowledgment of Release and Covenant Not to Pursue Claims. Consultant further represents that he has not and will not institute, prosecute or maintain on his own behalf, before any administrative agency, court or tribunal, any demand or claim of any type related to the matters released herein. Consultant hereby acknowledges that Consultant is aware that he or his attorney may hereafter discover claims or facts in addition to or different from those which Consultant now knows or believes to exist with respect to the subject matter of this release, and it is Consultant’s intention hereby to fully, finally, and forever settle and release all possible claims Consultant may have against the Company that may exist as of the date hereof. Further, it is expressly understood that, notwithstanding the discovery or existence of any such additional or different claims or facts, the release given herein shall be and remain in effect as a full and complete release with respect to the claims released hereunder. Furthermore, Consultant certifies that he has read all of this Agreement, including the release provisions contained herein, and that he fully understand all of the same.

 

7.04  Claims Not Released by Consultant. Notwithstanding anything in Sections 5.01,  5.02 and 5.03 of this Agreement, this release also does not apply to any claim arising after the Effective Date of this Agreement. This release does not in any way affect Consultant’s rights in any retirement plan(s), which rights are governed by the terms of the plan(s) and by applicable law. This release further does not apply to claims for unemployment compensation or for workers’ compensation benefits. This release also does not impair Consultant’s right to continuation of health insurance coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”).

 

8.             THE COMPANY’S RELEASE OF CLAIMS.

 

8.01 Released of Claims by Consultant. Except as provided in Sections 3 and 6.03 of this Agreement, the Company, on behalf of itself, its related or affiliated corporations and other entities, and its successors and assigns, hereby unconditionally, irrevocably and absolutely releases Consultant and his heirs, assigns, executors, and successors from any and all claims relating to, based upon, or arising out of, Consultant’s duties and obligations relating to his employment by or with the Company prior to the Resignation Date, and/or his separation from the Company, provided however, that the Company does not release Consultant from his covenants, obligations and duties arising from sections 2 – 4 and 7 - 10 of the Employee Agreement.

 

8.02 Specific Claims Released. Except as provided in Section 6.03, the Company, on behalf of itself and its related or affiliated corporations and other entities, successors and assigns, and any related corporations and/or entities hereby further unconditionally, irrevocably and absolutely releases Consultant and his heirs, assigns, executors, and successors from any and all other loss, liability, claims, demands, causes of action or suits of any type, whether known or unknown, liquidated or contingent, that are directly or indirectly related to, based upon, or arise out of, in whole or in part, Consultant’s employment by or with the Company, and/or his separation from the Company. The Released Claims include, without limitation, any claims, losses, demands, actions, causes of action, obligations, debts, and/or liabilities resulting from, based upon, or arising out of Consultant’s employment with the Company, his separation from the Company, or any transaction, event, action, dispute and/or activity related thereto, as well as any claim for general, special, or other compensatory damages, consequential damages, punitive damages, attorneys’ fees, costs, or other damages or expenses, or any claim for injunctive relief or other equitable relief, or any other tort, contract or statutory claim.

 

8.03 Claims Not Released by the Company. The Company does not release or otherwise excuse Consultant from his covenants, duties and obligations under sections 2 – 4 and 7 - 10 of the Employee Agreement, and Consultant shall continue to be bound thereby. The Company reserves its right to file a claim, cause of action or suit, or otherwise seek relief, for any and all losses, liabilities, debts, or other damages arising from Consultant’s violation of that section of the Employment Agreement.

 

9.             RIGHT TO CONSULT WITH COUNSEL. Consultant fully understands that he has the right to seek the advice of an attorney concerning this Agreement and the covenants and releases made herein. The Company hereby advises Consultant to seek the advice of legal counsel of his choice prior to signing this Agreement.

 

10.             TIME TO SIGN AGREEMENT. In accordance with the Older Worker’s Benefits Protection Act, Consultant may take up to twenty-one (21) days from the date of receipt of this Agreement in which to review and consider it, consult with counsel of his choosing about it, and sign the Agreement and deliver it to the Company. Consultant may sign the Agreement and deliver it to the Company before the end of the twenty-one (21) day period. If Consultant has not signed and returned the Agreement to the Company by the end of the twenty-one (21) day period, the offer shall be withdrawn automatically.

 

11.             TIME TO REVOKE AGREEMENT. After signing this Agreement, Consultant shall have seven (7) days within which to revoke this Agreement in its entirety. If Consultant revokes this Agreement, Consultant will not be entitled to enter into the Consulting Agreement described above, and this Agreement will be void and without effect whatsoever. Consultant may revoke his acceptance of this Agreement by delivering, or causing to be delivered, to Randy Hale, the Company’s Chief Executive Officer, at 3855 South 500 West, Suite J, Salt Lake City, Utah 84115, no later than the seventh day following the signing of this Agreement by Consultant, a written notice revoking the acceptance of the Agreement. After the seven-day rescission period has elapsed, Consultant shall not have the right to revoke or rescind this Agreement or the release contained herein.

 

12.             EFFECTIVE DATE. Consultant further acknowledges that this Agreement shall not become effective and enforceable until it has been signed by both the Company and Consultant and until eight (8) days following the execution of this Agreement by Consultant, provided the Agreement has not been rescinded by Consultant within the rescission period referenced in the preceding paragraph (“Effective Date”).

 

 

 

  

3

  

 

13.             INDEMNITY.

 

13.01 Third Party Actions. If Consultant is a party or is threatened to be made a party to any Proceeding (other than an action by or in the right of the Company) by reason of the fact that he is or was an officer or director of the Company, or by reason of anything done or not done by him in any such capacity, against any and all Expenses and liabilities of any type whatsoever (including, but not limited to, judgments, fines, and amounts paid in settlement) actually and reasonably incurred by him in connection with the investigation, defense, settlement or appeal of such Proceeding if he acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of the Company and, with respect to any criminal action or Proceeding, had no reasonable cause to believe his conduct was unlawful; and

 

13.02 Derivative Actions. If Consultant is a party or is threatened to be made a party to any Proceeding by or in the right of the Company to procure a judgment in its favor by reason of the fact that he is or was an officer or director of the Company, or by reason of anything done or not done by him in any such capacity, against any amounts paid in settlement of any such Proceeding and all Expenses actually and reasonably incurred by him in connection with the investigation, defense, settlement or appeal of such Proceeding if he acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of the Company; except that no indemnification under this subsection shall be made in respect of any claim, issue or matter as to which he shall have been finally adjudged to be liable to the Company by a court of competent jurisdiction due to willful misconduct in the performance of his duty to the Company; and

 

13.03 Exception for Amounts Covered by Insurance. Notwithstanding the foregoing, the Company shall not be obligated to indemnify Consultant for Expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines and amounts paid in settlement) to the extent such have been paid directly to Consultant by D&O Insurance.

 

13.04 Advancement. Subject to Section 13.05 below, the Company shall advance all Expenses incurred by Consultant in connection with the investigation, defense, settlement or appeal of any Proceeding to which Consultant is a party or is threatened to be made a party by reason of the fact that Consultant is or was an officer or director of the Company. Consultant hereby undertakes to promptly repay such amounts advanced if it shall ultimately be determined that Consultant is not entitled to be indemnified by the Company under the provisions of this Agreement, the Articles of Incorporation or Bylaws of the Company, the Private Corporations Law of Nevada or otherwise. The advances to be made hereunder shall be paid by the Company to Consultant within thirty (30) days following delivery of a written request therefor by Consultant to the Company.

 

13.05 Exceptions. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement to indemnify or advance Expenses to Consultant with respect to (i) Proceedings or claims initiated or brought voluntarily by Consultant, (ii) any amounts paid in settlement of a Proceeding unless the Company consents in advance in writing to such settlement, which consent shall not be unreasonably withheld, or (iii) a decision by a court having jurisdiction in the matter shall determine that such indemnification is not lawful.

 

13.06 Definitions. The following terms shall have the meanings given below:

 

13.06.1. Expenses. For purposes of this Agreement, “Expenses” includes all direct costs (including, without limitation, reasonable attorneys’ fees and related disbursements and other out-of-pocket costs) actually and reasonably incurred by Consultant in connection with the investigation, defense or appeal of a Proceeding; provided, however, that Expenses shall not include any judgments, fines, ERISA excise taxes or penalties or amounts paid in settlement of a proceeding.

 

13.06.2. Proceeding. For the purposes of this Agreement, “Proceeding” means any threatened, pending or completed action, suit or other proceeding, whether civil, criminal, administrative, investigative or any other type whatsoever.

 

13.06.3. D&O Insurance. For purposes of this Agreement, “D&O  Insurance” means one or more policies of directors’ and officers’ liability insurance, if any, on such terms and conditions as may be approved by the Board of Directors of the Company.

 

14. GENERAL PROVISIONS.

 

14.01 Severability. If any provision of this Agreement shall be held by a court to be invalid, unenforceable, or void, such provision shall be enforced to the fullest extent

permitted by law, and the remainder of this Agreement shall remain in full force and effect. In the event that the time period or scope of any provision is declared by a court of competent jurisdiction to exceed the maximum time period or scope that such court deems enforceable, then such court shall reduce the time period or scope to the maximum time period or scope permitted by law.

 

14.02 Governing Law. This Agreement shall be governed by the laws of the State of Utah without regard to conflict of law principles.

 

14.03 Dispute Resolution. All disputes and controversies arising out of or in connection with this Agreement shall be resolved exclusively by the state and federal courts located in Salt Lake County in the State of Utah, and each party hereto agrees to submit to the jurisdiction of said courts and agrees that venue shall lie exclusively with such courts. Each party hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection which such party may raise now, or hereafter have, to the laying of the venue of any such suit, action or proceeding brought in such a court and any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum. Each party agrees that, to the fullest extent permitted by applicable law, a final judgment in any such suit, action, or proceeding brought in such a court shall be conclusive and binding upon such party, and may be enforced in any court of the jurisdiction in which such party is or may be subject by a suit upon such judgment.

 

 

 

  

4

  

 

 

14.04 WAIVER OF RIGHT TO JURY TRIAL. TO THE EXTENT PERMITTED BY LAW, EACH PARTY HEREBY WAIVES ITS RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH PARTY HEREBY AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT, OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

 

14.05 Fees and Costs. The prevailing party in any court action or other adjudicative proceeding arising out of or relating to this Agreement shall be reimbursed by the party who does not prevail for their reasonable attorneys’ fees, accountants’ fees, and experts’ fees and for the costs of such proceeding. The provisions set forth in this Section shall survive the merger of these provisions into any judgment.

 

14.06 Amendments; Waivers. This Agreement may not be modified, amended, or changed except by an instrument in writing, signed by Consultant and by a duly authorized representative of the Company other than Consultant. No waiver or consent shall be binding

except in a writing signed by the party making the waiver or giving the consent. No waiver of any provision or consent to any action shall constitute a waiver of any other provision or consent to any other action, whether or not similar. No waiver or consent shall constitute a continuing waiver or consent except to the extent specifically set forth in writing.

 

14.07 Assignment. Consultant agrees that Consultant shall have no right to assign and shall not assign or purport to assign any rights or obligations under this Agreement. This Agreement may be assigned or transferred by the Company; and nothing in this Agreement shall prevent the consolidation, merger or sale of the Company or a sale of any or all or substantially all of its assets. Subject to the foregoing, this Agreement shall be binding upon and shall inure to the benefit of the parties and their respective successors, and permitted assigns, and shall not benefit any person or entity other than those specifically enumerated in this Agreement.

 

14.08 Parties in Interest. Nothing in this Agreement shall confer any rights or remedies under or by reason of this Agreement on any persons other than the parties hereto and their respective successors and permitted assigns nor shall anything in this Agreement relieve or discharge the obligation or liability of any third person to any party to this Agreement, nor shall any provision give any third person any right of subrogation or action over or against any party to this Agreement.

 

14.09 Construction. The terms of this Agreement have been negotiated by the parties hereto, and no provision of this Agreement shall be construed against either party as the drafter thereof.

 

14.10 Interpretation. This Agreement shall be construed as a whole, according to its fair meaning. Sections and section headings contained in this Agreement are for reference purposes only, and shall not affect in any manner the meaning or interpretation of this Agreement. Unless the context of this Agreement otherwise requires, (a) words of any gender shall be deemed to include each other gender; (b) words using the singular or plural number shall also include the plural or singular number, respectively; and (c) the terms “hereof,” “herein,” “hereby,” “hereto,” and derivative or similar words shall refer to this entire Agreement.

 

14.11 Notice. All notices or other communications given or made hereunder shall be in writing and shall be deemed duly given: (a) upon personal delivery to the party to be notified; (b) when sent by confirmed facsimile if sent during normal business hours of the recipient, if not, then on the next business day; (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (d) one (1) day after deposit with a nationally recognized overnight courier service, specifying next day delivery, with written verification of receipt. All communications shall be sent to the party’s address set forth on the signature page below, or at such other address as such party may designate by ten (10) days advance written notice to the other parties in accordance with this Section 9.11.

 

14.12 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original of this Agreement, but all of which together shall constitute one and the same instrument.

 

14.13 Authority. Each party represents and warrants that such party has the right, power and authority to enter into and execute this Agreement and to perform and discharge all of the obligations hereunder; and that this Agreement constitutes the valid and legally binding agreement and obligation of such party and is enforceable in accordance with its terms.

 

14.14 Entire Agreement. This Agreement contains the entire agreement between Consultant and the Company and there have been no promises, inducements or agreements not expressed in this Agreement.

 

14.15 No Admission of Liability. Nothing in this Agreement shall be construed as an admission of liability or wrongdoing by any party to this Agreement.

 

14.16 CONSULTANT ACKNOWLEDGEMENT. CONSULTANT HAS HAD THE OPPORTUNITY TO CONSULT LEGAL COUNSEL CONCERNING THIS AGREEMENT AND HAS OBTAINED AND CONSIDERED THE ADVICE OF SUCH LEGAL COUNSEL TO THE EXTENT CONSULTANT DEEMS NECESSARY OR APPROPRIATE, THAT CONSULTANT HAS READ AND UNDERSTANDS THE AGREEMENT, THAT CONSULTANT IS FULLY AWARE OF ITS LEGAL EFFECT, AND THAT CONSULTANT HAS ENTERED INTO IT FREELY BASED ON CONSULTANT’S OWN JUDGMENT AND NOT ON ANY REPRESENTATIONS OR PROMISES OTHER THAN THOSE CONTAINED IN THIS AGREEMENT.

 

 

 

[SIGNATURES TO FOLLOW]

 

  

5

  

 

IN WITNESS WHEREOF, the parties hereto have executed this Separation and Release Agreement as of the day and year first above written.

 

 

	 	“COMPANY”	 
	 	 	 
	 	ZAGG Inc,	 
	 	
a Nevada corporation

	 
	 	 	 
	 	 	 	 
	
 

	
By: 

	/s/  Brandon T. O’Brien	 
	 	Name: Brandon T. O’Brien	 
	 	Title: Chief Financial Officer	 
	 	 	 	 

 

	 	 	Address:  	3855 South 500 West, Suite J
	 	 	 	Salt Lake City, Utah 84115
	 	 	 	 
	 	 	 	Attn: Chief Financial Officer 
	 	 	 	Phone: (801) 263-0699
	 	 	 	Fax: (801)  263-1841
	 	 	 	 
	 	 	 	 

	 	"CONSULTANT"	 
	 	 	 	 
	
 

	
By: 

	/s/ Robert G. Pedersen II	 
	 	 	Robert G. Pedersen II	 
	 	 	 	 

 

	 	 	Address: 	5775 Holladay Blvd.
	 	 	 	Holladay, Utah 84121
	 	 	 	Phone: (801) 897-9195 
	 	 	 	Fax: (801) __________
	 	 	 	Email: Robert@zagg.com
	 	 	 	 

 

 

 

 

SIGNATURE PAGE

 

TO THE

 

SEPARATION AND RELEASE AGREEMENT

 

 

 

 

  

6

  

 

 

 

ZAGG Incorporated

EMPLOYMENT AGREEMENT

This Employment Agreement (the “Agreement”), dated effective as of the date executed by both parties, is between ZAGG Incorporated, a Nevada corporation with its principal place of business at 3855 South 500 West Suite J, Salt Lake City, UT  84115, and _______________________ (the “Employee” or “I”), an individual to be employed by Company.  This Agreement governs only those aspects of the employment relationship between Company and the Employee that are specifically addressed herein.

In consideration of the benefits of employment by Company, including salary, wages and/or other benefits, and in consideration of services to be provided by me to Company, the parties agree as follows:

1.           Scope of Duties and Acknowledgement.

a.           While I am employed by Company, unless otherwise agreed in writing, I will devote my full business time, attention, skill and effort to the performance of the duties that Company may assign to me.  I will comply with all policies and procedures established by Company.

b.           I acknowledge (i) that Company is engaged in a continuous program of marketing valuable products and services; (ii) that my employment by Company will create a relationship of confidence and trust with Company with respect to such business; (iii) that unauthorized use or disclosure of Confidential Information (as defined below) would injure Company; and (iv) that the covenants and agreements contained in this Agreement are material to and a requirement of my employment with Company.

c.           I authorize Company to notify others, including but not limited to customers of Company or my future employers, of the terms of this Agreement and my responsibilities hereunder.

2.           Confidential Information.

a.           Definition.  “Confidential Information” means all present and future confidential and/or proprietary information belonging to Company, whether developed by me or by other Company employees or agents, including but not limited to technology, inventions, products, formulations, processes, trade secrets, ideas, business and marketing plans and information, financial and operational matters, pricing information, customer names and information, and any other information marked as confidential or which reasonably should be understood to be confidential or proprietary, whether or not so marked.  However, Confidential Information does not include information that I can show has become available for unrestricted public use, without breach of this or any other agreement.

b.           Obligations of Confidentiality.  In the course of employment by Company, I may receive Confidential Information, which shall remain the sole property of Company.  I agree that, except as appropriate in connection with Company’s business, I will not at any time, during or after my employment, (i) disclose Confidential Information to any person; or (ii) use any Confidential Information for the direct or indirect benefit of any person or entity other than Company, except as Company may otherwise consent or direct in writing.  I will use reasonable and diligent efforts to maintain the proprietary nature, security and confidentiality of all Confidential Information.  I will also keep confidential any information provided by any client or other third party to Company under obligation of confidentiality.  I will promptly notify Company if I become aware of any misuse or wrongful disclosure of Confidential Information by any person.  All obligations of confidentiality shall continue for as long as is permitted under Utah law.

3.           Employee Inventions.

a.           Definitions.  I acknowledge that as a result of my employment with Company, I may have access to and be involved in the development of certain “Employee Inventions”, which term means all software, programs, inventions, technology, products, formulations, ideas, processes, trade secrets, text, materials, and Confidential Information, whether or not published, patented, copyrighted, registered or suitable therefor, and all intellectual property rights therein, that are made, developed, written, conceived or first reduced to practice by me in part or in whole, whether alone or with others, during the term of my employment with Company, to the extent they relate to Company’s past, present, future or anticipated business, research, development or trade, or are developed using Company’s time, equipment or materials.

b.           Obligations.  I acknowledge and agree that all Employee Inventions are the sole and exclusive property of Company, and hereby assign to the Company any copyrights, patent rights, trade secrets and other rights that I may have therein.  I agree to promptly disclose the existence, use and manner of operation of any Employee Inventions to Company.  I agree to take all actions reasonably requested by Company, both during and after the term of my employment by Company, to assign to Company and to establish (including, without limitation, assisting in obtaining or registering copyrights, patents, trademarks or similar property rights and executing assignments to Company), perfect, exercise or protect Company’s rights in any Employee Inventions or title thereto.   If Company is unable, because of my mental or physical incapacity, geographic distance or for any other reason, to obtain my approval or signature on any document necessary or useful to claim, secure, extend, protect or enforce any right in intellectual property to which Company has a reasonable claim, then I hereby appoint Company and its duly authorized officers as my agent and attorney-in-fact to act for me and in my place and stead for the purpose of accomplishing such act with the same legal force and effect as if executed by me.

4.           No Competitive Use of Materials.  I will not sell or use any materials or ideas from Employee Inventions or Confidential Information in any manner that would compete with or pose a threat of competition to Company.  I will not sell or use technology, software, names, titles, packaging, art work, or other key components of any Employee Inventions, whether or not a threat of competition is posed, without the express, written consent of Company.

5.           No Unrelated Business with Customers.  During the term of my employment with Company, unless Company agrees in writing, I will not contact or initiate discussions, directly or indirectly, with any customer or prospective customer of Company to attempt to sell such customer any product or service other than Company’s products or services.

6.           Return of Information.  Upon Company’s request or upon termination of my employment with Company, I will immediately return and deliver all Employee Inventions and Confidential Information to Company, whether in written, electronic, or any other form, including all copies of such information in my possession or control.

7.           Covenant Not to Compete.  I covenant that during the term of my employment with Company and for a period of two (2) years thereafter, I will not compete in any manner, directly or indirectly, with any business of Company, or assist any business in a field that competes with Company’s products or services, including participating as a principal, agent, owner, consultant or employee in any business competing with Company.  The geographic scope of these restrictions will include all geographic areas in the United States and elsewhere where Company does business, attempts to do business, or intends to do business as of the date of termination of my employment with Company.

 

 

 

  

7

  

 

8.           Non-Solicitation Covenant.  I covenant that during the term of my employment with Company and for two (2) years thereafter, I will not:

a. Do anything, directly or indirectly, which would solicit away from Company or otherwise tend to divert from Company any business with a customer or prospective customer of Company, including without limitation providing customer names, contacts or business information to a competitor of Company;

b. Associate with or contact, directly or indirectly, any customer or prospective customer of Company with the purpose or intent of competing with Company; or

c. Solicit, recruit or cause any Company employee or consultant to cease providing services for Company.

The term “prospective customer of Company” means any company or person to whom Company has sold products or services in the past or with whom Company has had contact during the term of my employment for the purpose of marketing or offering its products or services.

9.           Scope of Restrictions.  I acknowledge and agree that the restrictions of Sections 7 and 8 are reasonable under the circumstances and represent the least restriction on my future employment and ability to earn a living that are consistent with the protection of Company’s good will and Confidential Information, that these restrictions do not prevent me from earning a livelihood without violating the terms of this Agreement, and that Company has a legitimate business purpose in requiring me to abide by these covenants.  If any restriction or term herein is found to be unreasonable or invalid by a court of competent jurisdiction, then such court shall reduce or modify such term to the minimum extent necessary to make it reasonable, valid and enforceable.  If such term cannot be so reduced or modified, it shall be severed and all other terms and restrictions of this Agreement shall remain in full force and effect and shall be interpreted in such a way as to give maximum validity and enforceability to this Agreement.  If I violate these restrictive covenants, then their time limitations shall be extended for a period of time equal to the time during which such breach occurs.  Sections 7 and 8 are intended to be construed as a series of separate covenants, one for each city, county, state, or geographic area in which Company does or intends or attempts to do business.  Except for geographic coverage, each such separate covenant shall be deemed identical in terms.

10.           No Conflicts.  I hereby covenant, represent and warrant that (i) I am not now subject to, and will not enter into, any employment, consulting or other agreement or arrangement that may conflict with the performance by me of any of my obligations to Company (under this Agreement or otherwise); and (ii) I have not and will not use or disclose proprietary or confidential information of any other former employer or any other person or entity to which I have any duty of confidentiality.

11.           At Will Employment.

a.           Unless otherwise set forth in a written agreement between myself and Company or otherwise required by applicable law, I agree that I am an employee at will, and nothing in this Agreement shall be construed to provide otherwise.  “At will employment” means that either Company or I may terminate my employment at any time for any reason, with or without notice, and with or without cause, and without any procedure or formality.    Nothing in this Agreement or any employment dispute policy alters my at-will employment status.

b.           COMPANY RETAINS THE SOLE RIGHT AT ANY TIME, WITH OUR WITHOUT CAUSE OR PRIOR NOTICE, TO CHANGE OR ELIMINATE ANY POLICIES, PRACTICES AND TERMS AND CONDITIONS OF MY EMPLOYMENT, INCLUDING, WITHOUT LIMITATION, THE RIGHT TO TRANSFER, DISCIPLINE, DEMOTE, PROMOTE OR REASSIGN ME, TO INCREASE OR DECREASE MY COMPENSATION AND TO CHANGE OR ELIMINATE ANY JOB I MAY HAVE, ANY DUTIES OR RESPONSIBILITIES, REPORTING RELATIONSHIPS AND ALL BENEFIT PLANS AND PROGRAMS.

12.           Termination of Employment.  If my employment is terminated, I will, upon request, participate in an exit interview to finalize any issues and assure a proper transition.  On or before termination, I will return to Company all of its property, including equipment, documents, files, programs, tools, data, information and media pertaining to past, present, future or anticipated business, research, Employee Inventions and other Confidential Information.  I will not take with me or use any originals, copies or reproductions of any documents, data or information pertaining to any Confidential Information.  The terms of this Agreement will survive termination of my employment.

13.           Breach and Remedies.  If I breach any term of this Agreement, Company may immediately terminate my employment and seek any available remedies at law or in equity for such breach.  I agree that if I breach any covenants in this Agreement, including the covenants not to compete or solicit and the covenant of confidentiality, money damages shall be inadequate and Company shall be entitled to seek and obtain injunctive relief, in addition to any other remedies it might have, including damages, to prevent further breach of this Agreement.  I specifically release Company from the requirement of posting any bond in connection with temporary or interlocutory injunctive relief, to the extent permitted by law.

14.           General Provisions.

a.           I acknowledge and agree that this is a final and complete agreement, and supersedes any other employment agreement I may have entered into with Company in the past.  No amendment or waiver of any term of this Agreement, or of the terms of my employment, shall be binding on Company unless in a written agreement signed by an authorized officer of Company.

b.           I acknowledge that I have received a copy of Company’s Employment Dispute Resolution Policy (the “arbitration policy”), that I have reviewed the policy, and that I agree to comply with that policy as a condition of employment with Company.  I expressly agree that any and all disputes in which Company seeks to enforce its rights relating to its Confidential Information and unfair competition and solicitation practices, are exempt from the arbitration policy and that the arbitration policy does not apply to such disputes.  Except for those exclusions, I agree that the arbitration policy shall govern the resolution of any and all claims, disputes, and other controversies arising out of, or relating in any way, to the employment relationship between Company and its employees.  I understand and agree that the claims subject to the arbitration policy include claims for wrongful termination and claims alleging unlawful employment discrimination in violation of Title VII of the Civil Rights Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Utah Anti-Discrimination Act, the Worker Adjustment and Retraining Notification Act, and any other federal, state, or local law, and all other claims involving alleged discriminatory events, acts, patterns, or practices based on sex, race, age, disability, religion, national origin, marital status, sexual orientation, pregnancy, or any other status or characteristic protected by law.  I UNDERSTAND AND AGREE THAT BY SIGNING THIS AGREEMENT, I AM WAIVING ALL RIGHTS TO A JURY TRIAL FOR RESOLUTION OF THESE TYPES OF CLAIMS, DISPUTES AND CONTROVERSIES.

 

 

  

8

  

 

c.           I understand that Company’s policy is that, in general, it will inform prospective employers of former Company employees only: (1) whether that employee worked for Company, and (2) the dates of employment. However, I also understand that there may be some exceptions to that general rule and that, in some circumstances, additional information may be provided.  In this regard, I hereby waive, release, and hold harmless Company, its agents, employees, successors, and all other persons and entities from any and all claims, demands, damages, actions, causes of action, or suits of whatever kind or nature, under any federal, state, or local law, related in any way to Company providing information to any employer with which I may seek employment in the future.

d.           The failure of Company to take any action under this Agreement or the waiver of a breach of this Agreement will not affect Company’s right to require performance hereunder or constitute a waiver of any subsequent breach.  This Agreement will be governed by Utah law (without regard to conflicts of laws provisions) and applicable U.S. federal laws.  Utah state and federal courts shall have exclusive jurisdiction in any legal action arising out of this Agreement, and I consent to the personal jurisdiction and venue of such courts.  The prevailing party in any action arising out of this Agreement will be entitled to an award of its costs and reasonable attorneys’ fees, in addition to any other available remedy.  This Agreement shall be binding upon my heirs, legal representatives and successors.

I ACKNOWLEDGE THAT I HAVE READ AND UNDERSTAND THIS AGREEMENT AND THAT, BEFORE SIGNING THIS AGREEMENT, I WAS GIVEN AN OPPORTUNITY TO DISCUSS IT WITH MY PERSONAL ADVISORS AND WITH REPRESENTATIVES OF COMPANY.

 

	Employee:     	 	 	ZAGG Incorporated	 
	 	 	 	 	 
	 	 	 	 	 
	

Signature:

	 	 	
By:   

	 
	 	 	 	 	 
	
Print Name:    

	 	 	
Title:      

	 
	 	 	 	 	 
	
Date:   

	 	 	
Date:   

	 

 

    

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9ex102.htm

Exhibit 10.2

 

 

EXECUTION COPY

 

EXECUTIVE CONSULTING AGREEMENT

 

This Executive Consulting Agreement (hereinafter “Agreement”) is made and entered into this 28th day of September, 2012 (hereinafter the “Effective Date”) by and between ZAGG INC, a Nevada corporation whose principal place of business is in Salt Lake County, Utah (the “Company”), and ROBERT G. PEDERSEN II, an individual (“Consultant”), and is based upon the following:

 

RECITALS

 

WHEREAS, Consultant was previously employed by the Company as its Chief Executive Officer, having resigned on August 17, 2012 as its Chief Executive Officer and as the Chairman of its Board of Directors;

 

WHEREAS, in connection with the termination of his employment with the Company, the Company and Consultant have executed and delivered the Separation and Release of Claims Agreement attached hereto as Exhibit A (the “Separation and Release Agreement”), which is incorporated herein in its entirety; and

 

WHEREAS, the Company desires to continue to obtain Consultant’s services and assistance under the terms and conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the mutual promises hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and Consultant agree as follows:

 

AGREEMENT

 

1. ENGAGEMENT; CONSULTING SERVICES.

 

1.01 Term of Engagement. The term of this Agreement shall commence on the Effective Date of this Agreement and shall end on the earlier of: (a) Consultant’s death, or (b) August 16, 2013 (the “Term”), unless otherwise terminated pursuant to Section 3 of this Agreement, provided, however, that the parties may extend the Term by mutual agreement.

 

1.02 Consulting Services; Time Commitment. The Company hereby retains Consultant to provide consulting services under the title “Founder and Executive Consultant,” including without limitation, services related to the current and historical finances and operations of the Company, relationships with licensors, customers and vendors, product development, marketing and distribution, representing the Company at public appearances, participation in Company meetings as an independent contractor on projects and matters as requested from time to time by the Chairman of the Board of the Company and serving at the pleasure of the Company as the Chairman of the Board of Directors of HzO, Inc. (the “Consulting Services”). For avoidance of doubt and not by away of limitation, the Consulting Services will expressly include the following: (i) speaking at no less than six (6) Company events during the Term, (ii) participation in selected customers/vendor meetings, (iii) attendance at ZAGG functions at the Consumer Electronics Show in Las Vegas, Nevada in January 2013, (iv) attendance at ZAGG functions at the MacWorld tradeshow in San Francisco, California in January 2013, and (v) attendance at ZAGG functions at the CTIA Wireless tradeshow in Las Vegas Nevada in May 2013. Consultant hereby agrees to reasonably perform the Consulting Services at the request of the Company, in each case, on the terms and subject to the conditions set forth herein; provided, however, that the Consulting Services shall not require the commitment of more than ten (10) hours per week during the Term. Nothing in this Agreement shall obligate or require the Company to request or use Consultant’s Consulting Services during any particular month of the Term of this Agreement, and Consultant should have no expectation that his Consulting Services will be requested during each month of the Term. The Company will provide reasonable advance notice to Consultant of any project or matter as to which Consultant will be requested to provide Consulting Services or any meeting that the Company requires Consultant to attend. All requests by the Company will take into consideration Consultant’s other commitments and the Company will, to the extent reasonably practicable, accommodate Consultant’s schedule in requesting work.

 

 

 

  

1

  

 

1.03 Quality of Consulting Services. Consultant shall perform the Consulting Services in substantially the same manner, nature and quality as services were performed by Consultant to the Company immediately prior to Consultant’s resignation, except that the amount of time dedicated to the Consulting Services will be equal to or less than ten (10) hours per week. The parties will use good-faith efforts to reasonably cooperate with each other in all matters relating to the provision and receipt of the Consulting Services; all conflicts relating to Consultant’s availability or the scope of the required Consulting Services to be resolved directly with the Company’s CEO or the Chairman of its Board of Directors. The Company acknowledges that Consultant will be involved in other business activities during the Term of this Agreement.

 

1.04 No Conflict. Consultant represents and warrants that his execution of this Agreement, his engagement with the Company, and the performance of the Consulting Services shall not violate any obligations Consultant may have to any other person or entity, including any obligations with respect to proprietary or confidential information of any other person or entity.

 

2.            CONSIDERATION. In consideration for the Consulting Services and for Consultant’s commitment to provide the Consulting Services, the Company agrees to (i) pay Consultant a consulting fee during the Term of this Agreement in the aggregate amount of $910,000 to be paid in twelve (12) equal monthly installments, the first payment being paid on the Effective Date and each subsequent payment being paid on the 1 6th day of each succeeding month during the Term, and (ii) reimburse Consultant’s health and life insurance premiums during the Term and for twelve (12) months thereafter; provided that reimbursement of health insurance premiums will cease if Consultant obtains new employment where health insurance is available to him (the “Consulting Fee”), provided further that Consultant does not revoke or attempt to revoke the Separation and Release Agreement and does not disparage the Company, its products, officers, directors, employees, vendors or customers. Consultant will be reimbursed reasonable travel and other expenses incurred in connection with Consulting Services requested by the Company.

 

3. TERMINATION OF AGREEMENT.

 

3.01 Grounds for Early Termination by Company. Notwithstanding the covenants contained in Sections 1.01 and 2 of this Agreement, the Company may terminate this Agreement at any time if (a) Consultant revokes or attempts to revoke the Separation and Release Agreement pursuant to the terms of Section 8 of that agreement; (b) Consultant commits an act of fraud, dishonesty, or embezzlement against the Company or any affiliate thereof; (c) Consultant has been convicted (or entered a plea of nolo contendre in lieu thereof) of a felony or of a crime involving fraud, dishonesty, moral turpitude, or physical harm to any person; (d) Consultant materially breaches one or more terms of this Agreement; (e) Consultant discloses Confidential Information (as defined in Section 5.01 of this Agreement) without authorization which disclosure Consultant knew or reasonably should have known would result in damage to the Company; (f) Consultant engages in conduct that is in bad faith and materially injurious to the Company, including but not limited to, misappropriation of trade secrets or a business opportunity; (g) Consultant refuses to follow a lawful rule, policy, regulation or directive of the Company; (h) Consultant uses drugs or alcohol in violation of Company policy or that impedes Consultant’s job performance; (i) Consultant commits any act to secure or attempt to secure any personal profit not fully disclosed to and approved by the Company in connection with any transaction entered into on behalf of the Company; or (j) Consultant engages in any other gross, willful or wanton negligence, intentional misconduct, or conduct that jeopardizes the reputation of the Company or its relationship with its vendors or customers.

 

3.02 No Payment After Early Termination. If the Company terminates the Agreement for any of the reasons stated in Section 3.01 of this Agreement, the Company shall pay Consultant any unpaid Consulting Fees earned and unpaid health insurance premium reimbursements as of the date of termination of this Agreement, but shall not be liable to pay Consultant any Consulting Fees or reimburse Consultant for any other health and life insurance premiums for the remainder of the Term and shall not request Consultant’s Consulting Services during the remainder of the Term.

 

4.             INDEPENDENT CONSULTANT. Nothing in this Agreement shall in any way be construed to constitute Consultant as an agent, employee or representative of the Company. Consultant will have no authority to enter into contracts which bind the Company or create obligations on the part of the Company without the express prior authorization of the Company. Instead, Consultant’s relationship with the Company will be that of an independent contractor performing the Consulting Services. Consultant will not be eligible for any employee benefits, nor will the Company make deductions from payments made to Consultant for taxes. Consultant acknowledges and agrees that Consultant is obligated to report as income all consideration that he receives under this Agreement, and Consultant acknowledges and agrees to pay all self-employment and other taxes thereon.

 

5.             NON-DISCLOSURE AND CONFIDENTIALITY. Consultant agrees that during his engagement with the Company, whether or not under this Agreement, and at all times thereafter:

 

5.01 Definition of Confidential Information. As used herein, the term “Confidential Information” means all trade secrets and all other information of a business, financial, marketing, technical or other nature relating to the Company or any affiliate, parent or subsidiary of the Company, including HzO, Inc., (each, an “Affiliate”), including, without limitation, any customer or vendor lists, prospective customer names, financial statements and projections, know-how, pricing policies, operational methods, methods of doing business, technical processes, formulae, designs and design projects, inventions, computer hardware, software programs, business plans and projects pertaining to the Company or any Affiliate and including any information of others that the Company or any Affiliate has agreed to keep confidential; provided, that Confidential Information shall not include any information that has entered or enters the public domain through no fault of Consultant. For purposes of this Agreement, Confidential Information includes information that Consultant learned during the time he was employed by the Company pursuant to the terms of the Employment Agreement or any other agreement.

 

5.02 Non-Disclosure and Unauthorized Use of Confidential Information. Consultant shall not at any time, directly or indirectly, disclose, copy, or divulge any Confidential Information except as required in connection with the performance of his duties for the Company or any Affiliate, and except to the extent required by law (but only after Consultant has provided the Company or the applicable Affiliate with reasonable notice and opportunity to take action against any legally required disclosure). Consultant shall make no use whatsoever, directly or indirectly, of any Confidential Information at any time, except as required in connection with the performance of his duties for the Company or any Affiliate.

 

 

 

  

2

  

 

5.03 Return of Property upon Termination. Upon the termination of Consultant’s engagement with the Company or upon the Company’s request at any time and for any reason, Consultant shall immediately deliver to the Company all materials (including all soft and hard copies) in his possession which contain or relate to Confidential Information.

 

5.04 Inventions and Developments. All inventions, modifications, discoveries, designs, developments, improvements, processes, software programs, works of authorship, documentation, formulae, data, techniques, know-how, secrets or intellectual property rights or any interest therein (collectively, the “Developments”) made by Consultant, either alone or in conjunction with others, at any time or at any place during Consultant’s engagement or prior employment with the Company, whether or not under this Agreement and whether or not reduced to writing or practice during such period of engagement or prior employment, which relate to consumer electronics, shall be and hereby are the exclusive property of the Company without any further compensation to Consultant, unless otherwise agreed by the Board of Directors of the Company in writing. In addition, without limiting the generality of the prior sentence, all Developments which are copyrightable work by Consultant are intended to be “work made for hire” as defined in Section 101 of the Copyright Act of 1976, as amended, and shall be and hereby are the property of the Company.

 

5.05 Assignment of Developments. Consultant shall promptly disclose any Developments to the Company. If any Development is not the property of the Company by operation of law, this Agreement or otherwise, Consultant will, and hereby does, assign to the Company all right, title and interest in such Development, without further consideration, and will assist the Company and its nominees in every way, at the Company’s expense, to secure, maintain, enforce and defend the Company’s rights in such Development. Consultant shall sign all instruments necessary for the filing and prosecution of any applications for, or extension or renewals of, letters patent (or other intellectual property registrations or filings) of the United States or any foreign country which the Company desires to file and relates to any Development. Consultant hereby irrevocably designates and appoints the Company and its duly authorized officers and agents as his agent and attorney-in-fact (which designation and appointment shall be deemed coupled with an interest and shall survive Consultant’s death or incapacity), to act for and in Consultant’s behalf to execute and file any such applications, extensions or renewals and to do all other lawfully permitted acts to further the prosecution and issuance of such letters patent, other intellectual property registrations or filings or such other similar documents with the same legal force and effect as if executed by Consultant.

 

6.            NONCOMPETITION. In consideration of this engagement with the Company, Consultant agrees as follows:

 

6.01 Covenant Not to Compete. During the term of Consultant’s engagement and for eighteen (18) months thereafter (the “Non-Compete Period”), Consultant shall not, in any manner, directly or indirectly, in the Restricted Territory (as defined hereafter): (a) engage or invest in, (b) own, manage, operate, finance, control, (c) participate in the ownership, management, operation, financing, or control of, or (d) be employed by, work for or with, or in any way assist, any business, person, firm, corporation, partnership, limited liability company, governmental or private entity, or any other entity of whatever kind, engaged in any business in which the Company or any Affiliate is engaging or is planning in writing to engage during or at the time of termination of the Term (collectively, the “Restricted Business”) without the prior written authorization of the Board of Directors of the Company. For purposes of this Agreement, the “Restricted Territory” means the geographic area consisting of the United States of America or anywhere else in the world where the Company or any Affiliate does business or is planning to do business as of the date of the termination of Consultant’s engagement with the Company. Nothing contained in this Agreement, including this Section 5.01, shall prohibit Consultant from being a passive owner of not more than five percent (5%) of the outstanding stock of any class of a corporation, any securities of which are publicly traded, so long as Consultant has no active participation in the business of such corporation.

 

6.02 Non-Solicitation of Other Employees. During the term of Consultant’s engagement and for eighteen (18) months thereafter (the “Non-Solicitation Period”), Consultant shall not directly or indirectly solicit, induce, recruit or encourage any person employed by or otherwise providing services to the Company or any Affiliate to terminate his or her employment or services with the Company or that Affiliate or to take employment with another person, including, without limitation Consultant; any other entity controlled or organized by Consultant or in which Consultant is an officer, director, or agent; and any other entities that are competitive or are potentially competitive with the Company.

 

6.03 No Solicitation of Customers or Suppliers. During the term of Consultant’s engagement with Company and for a period of eighteen (18) months thereafter (the “Customer and Supplier Non-Solicitation Period”), Consultant agrees not to divert or attempt to divert from the Company (or any Affiliate of the Company) any business of any kind, including without limitation the Company’s or any Affiliate’s customers, clients, members, investors, business partners, vendors or suppliers.

 

6.04 No Competitive Planning. During the term of his engagement with Company, Consultant agrees not to prepare to compete with the Company or any of its Affiliates or to otherwise engage in any planning or activities relating to business interests that would be competitive or potentially competitive with the business of Company or any of its Affiliates.

 

6.05 Communication of Contents of Covenants. During the Non-Compete Period, Consultant shall communicate the contents of this Section 6 to any person (including any business) that Consultant intends to be retained or employed by, associated with, or represent and which Consultant knows is engaged in the Restricted Business in the Restricted Territory.

 

6.06 Tolling of Covenant. If it is judicially determined that Consultant has violated any of his obligations under Section 6 of this Agreement, then the Non-Compete Period, the Non-Solicitation Period and, alternatively or additionally, the Customer and Supplier Non-Solicitation Period, as the case may be, will automatically be extended by a period of time equal in length to the period during which such violation or violations occurred.

 

 

  

3

  

 

6.07 Consultant’s Acknowledgment. Consultant acknowledges that the obligations of Consultant under this Section 6 (including the geographic boundaries, scope of prohibited activities and the time duration of the provisions) are reasonable in the context of the nature of the Restricted Business and the competitive injuries likely to be sustained by the Company if Consultant were to violate such obligations, and are no broader than are necessary to protect the legitimate business interests of the Company and any Affiliate of the Company. Consultant further acknowledges that the Company would not have engaged Consultant in the absence of this Section 6 and the other covenant, representations and warranties of Consultant made herein, which Consultant acknowledges constitutes good, valuable and sufficient consideration. Consultant also acknowledges that, in the event Consultant’s engagement with the Company is terminated for any reason, Consultant will be able to earn a livelihood without violating his obligations under this Section 6 and that Consultant’s ability to earn a livelihood without violating such obligations is a material condition to Consultant’s engagement with the Company.

 

7.             REMEDIES. If Consultant breaches or threatens to breach any of the provisions of Sections 5 or 6 herein, the Company shall have the right to have such provisions specifically enforced by preliminary and permanent injunctions or otherwise without the necessity of filing a bond, it being acknowledged and agreed that any such breach or threatened breach will cause continuing and irreparable injury to the Company and that money damages will not provide an adequate remedy to the Company. The Company and Consultant agree that the remedy in this Section 7 shall be in addition to any and all other remedies available at law or in equity.

 

8.             MISCELLANEOUS.

 

8.01 Assignment. The performance of Consultant is personal hereunder, and Consultant agrees that Consultant shall have no right to assign and shall not assign or purport to assign any rights or obligations under this Agreement. This Agreement may be assigned or transferred by the Company to any person or entity, including but not limited to any Affiliate; and nothing in this Agreement shall prevent the consolidation, merger or sale of the Company or a sale of any or all or substantially all of its assets. Subject to the foregoing, this Agreement shall be binding upon and shall inure to the benefit of the parties and their successors, and permitted assigns, and shall not benefit any person or entity other than those specifically enumerated in this Agreement.

 

8.02 Indemnification. Subject to the last sentence of this Section 8.02 below, the Company shall indemnify and hold Consultant harmless if he becomes or is threatened to be made a party to any proceeding, whether civil, criminal or administrative, other than actions by or in the right of the Company (each a “Proceeding”), arising from or relating to the Consulting Services, against expenses (including attorney’s fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by Consultant in connection with any Proceeding (“Expenses”), except that no indemnification under this Section shall be made in respect of any claim, issue or matter arising in any Proceeding as to which Consultant’s actions or omissions constitute gross negligence. Subject to the last sentence of this Section 8.02, the Company shall advance all reasonable legal expenses incurred by Consultant in connection with the investigation, defense, settlement or appeal of any Proceeding to which Consultant is a party or is threatened to be made a party and arising from or relating to the Consulting Services; provided that counsel for Consultant is reasonably acceptable to the Company. Consultant hereby undertakes to promptly repay such amounts advanced if it shall ultimately be determined that Consultant is not entitled to be indemnified by the Company under the provisions of this Agreement. The advances to be made hereunder shall be paid by the Company to Consultant within thirty (30) days following delivery of a written request therefor by Consultant to the Company. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement to indemnify or advance Expenses to Consultant with respect to (i) Proceedings or claims initiated or brought voluntarily by Consultant, (ii) any amounts paid in settlement of a Proceeding unless the Company consents in advance in writing to such settlement, which consent shall not be unreasonably withheld, or (iii) a decision by a court having jurisdiction in the matter shall determine that such indemnification is not lawful.

 

8.03 Parties in Interest. Nothing in this Agreement shall confer any rights or remedies under or by reason of this Agreement on any persons other than the parties hereto and their respective successors and permitted assigns nor shall anything in this Agreement relieve or discharge the obligation or liability of any third person to any party to this Agreement, nor shall any provision give any third person any right of subrogation or action over or against any party to this Agreement.

 

8.04 Severability. If any provision of this Agreement shall be held by a court to be invalid, unenforceable, or void, such provision shall be enforced to the fullest extent permitted by law, and the remainder of this Agreement shall remain in full force and effect. In the event that the time period or scope of any provision is declared by a court of competent jurisdiction to exceed the maximum time period or scope that such court deems enforceable, then such court shall reduce the time period or scope to the maximum time period or scope permitted by law.

 

8.05 Survival. The terms and provisions of the Company’s and Consultant’s obligations or agreements under Sections 5, 6 and 7 herein shall survive any termination of Consultant’s engagement hereunder and the termination of this Agreement and will be construed as agreements independent of any other provisions of this Agreement.

 

8.06 Amendments and Waivers. This Agreement may not be modified, amended, or changed except by an instrument in writing, signed by the President or other executive officer of the Company. No waiver or consent shall be binding except in a writing signed by the party making the waiver or giving the consent. No waiver of any provision or consent to any action shall constitute a waiver of any other provision or consent to any other action, whether or not similar. No waiver or consent shall constitute a continuing waiver or consent except to the extent specifically set forth in writing.

 

8.07 Notice. All notices or other communications given or made hereunder shall be in writing and shall be deemed duly given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed facsimile if sent during normal business hours of the recipient, if not, then on the next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (d) one (1) day after deposit with a nationally recognized overnight courier service, specifying next day delivery, with written verification of receipt. All communications shall be sent to the party’s address set forth on the signature page below, or at such other address as such party may designate by ten (10) days advance written notice to the other parties in accordance with this Section 8.06.

 

8.08 Entire Agreement. This Agreement is intended to be the final, complete, and exclusive statement of the terms of Consultant’s employment by the Company and may not be contradicted by evidence of any prior or contemporaneous statements or agreements, except for agreements specifically referenced herein. Except as otherwise noted herein or in the Consulting Agreement, this Agreement supersedes and replaces any other agreement between Consultant and the Company. To the extent that the practices, policies or procedures of the Company, now or in the future, apply to Consultant and are inconsistent with the terms of this Agreement, the provisions of this Agreement shall control. Any subsequent change in Consultant’s duties, position, or compensation will not affect the validity or scope of this Agreement.

 

 

  

4

  

 

8.09 Further Instruments. The parties hereto agree that they will execute any and all other documents or legal instruments that may be necessary or required to carry out and effectuate all of the provisions hereof.

 

8.10 Governing Law. This Agreement, and all matters relating hereto, including any matter or dispute arising out of the Agreement, shall be interpreted, governed, and enforced according to the laws of the State of Utah, without regard to conflict of laws principals.

 

8.11 Dispute Resolution. All disputes and controversies arising out of or in connection with this Agreement, Consultant’s engagement with the Company, or the transactions contemplated hereby shall be resolved exclusively by the state and federal courts located in Salt Lake County in the State of Utah, and each party hereto agrees to submit to the jurisdiction of said courts and agrees that venue shall lie exclusively with such courts. Each party hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection which such party may raise now, or hereafter have, to the laying of the venue of any such suit, action or

proceeding brought in such a court and any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum. Each party agrees that, to the fullest extent permitted by applicable law, a final judgment in any such suit, action, or proceeding brought in such a court shall be conclusive and binding upon such party, and may be enforced in any court of the jurisdiction in which such party is or may be subject by a suit upon such judgment.

 

8.12 WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY LAW, EACH PARTY HEREBY WAIVES ITS RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR CONSULTANT’S ENGAGEMENT BY THE COMPANY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH PARTY HEREBY AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT, OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

 

8.13 Attorneys’ Fees. The prevailing party in any arbitration, court action or other adjudicative proceeding arising out of or relating to this Agreement or Consultant’s engagement with the Company shall be reimbursed by the party who does not prevail for their reasonable attorneys’, accountants’, and experts’ fees and for the costs of such proceeding. The provisions set forth in this Section shall survive the merger of these provisions into any judgment.

 

8.14 Paragraph Headings. The paragraph headings of this Agreement are inserted only for convenience and in no way define, limit, or describe the scope or intent of this Agreement nor affect its terms and provisions.

 

8.15 Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement and no provision of this Agreement shall be construed against either party as the drafter thereof.

 

8.16 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original of this Agreement, but all of which together shall constitute one and the same instrument.

 

8.17 Authority. Each party represents and warrants that such party has the right, power and authority to enter into and execute this Agreement and to perform and discharge all of the obligations hereunder; and that this Agreement constitutes the valid and legally binding agreement and obligation of such party and is enforceable in accordance with its terms.

 

8.18 CONSULTANT ACKNOWLEDGEMENT. CONSULTANT HAS HAD THE OPPORTUNITY TO CONSULT LEGAL COUNSEL CONCERNING THIS AGREEMENT AND HAS OBTAINED AND CONSIDERED THE ADVICE OF SUCH LEGAL COUNSEL TO THE EXTENT CONSULTANT DEEMS NECESSARY OR APPROPRIATE, THAT CONSULTANT HAS READ AND UNDERSTANDS THE AGREEMENT, THAT CONSULTANT IS FULLY AWARE OF ITS LEGAL EFFECT, AND THAT CONSULTANT HAS ENTERED INTO IT FREELY BASED ON CONSULTANT’S OWN JUDGMENT AND NOT ON ANY REPRESENTATIONS OR PROMISES OTHER THAN THOSE CONTAINED IN THIS AGREEMENT.

 

[The remainder of this page is intentionally left blank.]

 

 

  

5

  

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Consulting Agreement as of the day and year first above written.

 

	 	“COMPANY”	 
	 	 	 
	 	ZAGG Inc,	 
	 	
a Nevada corporation

	 
	 	 	 
	 	 	 	 
	
 

	
By: 

	/s/  Brandon T. O’Brien	 
	 	Name: Brandon T. O’Brien	 
	 	Title: Chief Financial Officer	 
	 	 	 	 

 

	 	 	Address:  	3855 South 500 West, Suite J
	 	 	 	Salt Lake City, Utah 84115
	 	 	 	 
	 	 	 	Attn: Chief Financial Officer 
	 	 	 	Phone: (801) 263-0699
	 	 	 	Fax: (801) 263-1841
	 	 	 	 
	 	 	 	 

	 	"CONSULTANT"	 
	 	 	 	 
	
 

	
By: 

	/s/ Robert G. Pedersen II	 
	 	 	Robert G. Pedersen II	 
	 	 	 	 

 

	 	 	Address: 	5775 Holladay Blvd.
	 	 	 	Holladay, Utah 84121
	 	 	 	Phone: (801) 897-9195 
	 	 	 	Fax: (801) __________
	 	 	 	Email: Robert@zagg.com
	 	 	 	 

 

 

 

  

6

  

 

 

“EXHIBIT A

 

Separation and Release Agreement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00208-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00208-of-00352.parquet"}]]