Document:

Exhibit 10.1

 Exhibit 10.1 

THE BLACKSTONE GROUP L.P. 

2007 EQUITY INCENTIVE PLAN 

SPECIAL EQUITY AWARD 

DEFERRED HOLDINGS UNIT AGREEMENT 

 

			
	Participant:	  	Date of Grant: July 1, 2015
		
	Number of Deferred Units:	  	

 1. Grant of Deferred Units. The Partnership hereby grants the number of deferred units (the
“Deferred Units”) listed above to the Participant (the “Award”), effective as of July 1, 2015 on the terms and conditions hereinafter set forth in this agreement (the “Award Agreement”). This
grant is made pursuant to the terms of The Blackstone Group L.P. 2007 Equity Incentive Plan (as amended, modified or supplemented from time to time, the “Plan”), which is incorporated herein by reference and made a part of this
Award Agreement. Each Deferred Unit represents the unfunded, unsecured right of the Participant to receive a Blackstone Holdings Partnership Unit on the delivery date(s) specified in Section 4 hereof. 

2. Definitions. Capitalized terms not otherwise defined herein shall have the same meanings as in the Plan. 

(a) “Cause” shall mean the occurrence or existence of any of the following as determined fairly, reasonably,
on an informed basis and in good faith by the Administrator: (i) any breach by the Participant of any provision of the Non-Competition, Non-Solicitation and Confidentiality Agreements to which the Participant is a party, (ii) any material
breach of any rules or regulations of the Partnership or its Affiliates applicable to the Participant, (iii) Participant’s deliberate failure to perform his or her duties to the Partnership or its
Affiliates, (iv) Participant’s committing to or engaging in any conduct or behavior that is or may be harmful to the Partnership or its Affiliates in a material way; (v) any act of fraud, misappropriation, dishonesty,
embezzlement or similar conduct against the Partnership or its Affiliates; or (vi) conviction (on the basis of a trial or by an accepted plea of guilty or nolo contendere) of a felony or crime (including any misdemeanor charge involving moral
turpitude, false statements or misleading omissions, forgery, wrongful taking, embezzlement, extortion or bribery), or a determination by a court of competent jurisdiction, by a regulatory body or by a self-regulatory body having authority with
respect to securities laws, rules or regulations of the applicable securities industry, that the Participant individually has violated any applicable securities laws or any rules or regulations thereunder, or any rules of any such self-regulatory
body (including, without limitation, any 

  
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licensing requirement), if such conviction or determination has a material adverse effect on (A) the Participant’s ability to function as an employee of the Partnership or its
Affiliates, taking into account the employment required of the Participant and the nature of the Partnership’s or its Affiliates’ business or (B) the business of the Partnership or its Affiliates. 

(b) “Employment Agreement” shall mean the Senior Managing Director Agreement (including all schedules and
exhibits thereto), entered into between the Blackstone Holdings I L.P. and the Participant. 
 (c) “Holdback Delivery
Date” shall mean the earlier of (i) the tenth anniversary with respect to each Vesting Date and (ii) the date on which the Restrictive Covenant Expiration Period expires. 

(d) “Non-Competition, Non Solicitation and Confidentiality Agreement” shall mean any agreement, and any
attachments or schedules thereto, entered into by and between the Participant and the Partnership or its Affiliates, pursuant to which the Participant has agreed, among other things, to certain restrictions relating to non-competition,
non-solicitation and/or confidentiality, in order to protect the business of the Partnership and its Affiliates. 
 (e)
“Qualifying Event” shall mean, during the Participant’s Employment with the Partnership and its Affiliates, the Participant’s death, Disability or Retirement. 

(f) “Retirement” shall mean the retirement of the Participant from his Employment with the Partnership and its
Affiliates after (i) the Participant has reached age 65 and has at least five full years of service with the Partnership and its Affiliates, or (ii) (x) the Participant’s age plus years of service with the Partnership and its
Affiliates totals at least 65, (y) the Participant has reached age 55, and (z) the Participant has had a minimum of five years of service. 

(g) “Restrictive Covenant Expiration Period” shall be one year following the date of the Participant’s
termination of Employment with the Partnership and its Affiliates. 
 (h) “Retention Percentage” shall mean
25% of the vested units until the corresponding Holdback Delivery Date, at which time it shall be 0%. 
 (i)
“Retention Units” shall mean, on any given date, the Deferred Units that have become Vested Deferred Units and which are retained by the Partnership (along with the underlying Blackstone Holdings Partnership Units) in accordance
with Section 4 hereof. 
 (j) “Vested Deferred Units” shall mean those Deferred Units which have become
vested pursuant to Section 3 or otherwise pursuant to the Plan. 

  
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 (k) “Vesting Dates” shall mean July 1,
2018, July 1, 2019 and July 1, 2020, as described in Section 3(a) hereof. 
 3. Vesting. 

(a) Vesting – General. Subject to the Participant’s continued Employment with the Partnership and its
Affiliates, the Award shall vest on the applicable Vesting Dates as follows: 
 (i) Twenty percent of the Deferred Units
granted hereunder shall vest on July 1, 2018 (the “First Vesting Date”); an additional 30% of the Deferred Units granted hereunder shall vest on July 1, 2019 (the “Second Vesting Date”); and the remaining
50% of the Deferred Units granted hereunder shall vest on July 1, 2020 (the “Third Vesting Date”). 

(b) Vesting – Qualifying Events. 

(i) Death or Disability. Upon the occurrence of a Qualifying Event on account of the death or Disability of the
Participant, 100% of the Deferred Units granted hereunder shall vest (to the extent not previously vested) upon the date of such event. 

(ii) Retirement. Upon the occurrence of a Qualifying Event on account of the Retirement of the Participant, (I) 50%
of the then unvested Deferred Units shall remain eligible to vest upon each of the following scheduled Vesting Dates, and (II) all other unvested Deferred Units shall be cancelled immediately and the Participant shall automatically forfeit all
rights with respect to such unvested Deferred Units upon the date of such event; provided that if, following the Participant’s Retirement, the Participant breaches any applicable provision of the Non-Competition, Non-Solicitation and
Confidentiality Agreement to which the Participant is a party or otherwise engages in any Competitive Activity, the Participant’s Deferred Units which remain undelivered as of the date of such violation or engagement in Competitive Activity, as
determined by the Administrator in its sole discretion, will be forfeited without payment. As a pre-condition to a Participant’s right to continued vesting and delivery of the Deferred Units following Retirement, the Administrator may require
the Participant to certify in writing prior to each scheduled Vesting Date that the Participant has not breached any applicable provisions of the Participant’s Non-Competition, Non-Solicitation and Confidentiality Agreement or otherwise engaged
in any Competitive Activity. 
 (c) Vesting – Terminations. Except as otherwise set forth in Section 3(b),
in the event the Participant’s Employment with the Partnership and its Affiliates is terminated for any reason, the portion of the Award that has not yet vested pursuant to Section 3(a) or 3(b) hereof (or otherwise pursuant to the Plan)
shall be cancelled immediately and the Participant shall automatically forfeit all rights with respect to such portion of the Award as of the date of such termination. 

  
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 4. Delivery. 

(a) Delivery – General. The Partnership shall, on each applicable Vesting Date set forth below, deliver to the
Participant the Blackstone Holdings Partnership Units underlying the Deferred Units which vest and become Vested Deferred Units on such date; provided that on each such Vesting Date, the Partnership shall retain, as Retention Units (and
withhold the corresponding underlying Blackstone Holdings Partnership Units with respect thereto) a number of Vested Deferred Units so that the aggregate number of Retention Units at such time (expressed as a percentage of the aggregate number of
Deferred Units awarded to the Participant which have vested as of such date) is equal to the applicable Retention Percentage. The Blackstone Holdings Partnership Units underlying Retention Units will be delivered to the Participant as and when, and
to the extent that, the number of Retention Units at any time exceeds the applicable Retention Percentage, as illustrated in the table below, with the Blackstone Holdings Partnership Units underlying any remaining Retention Units delivered to the
Participant upon the Holdback Delivery Date. 
  

																					
	 	  	Annual
Vesting	 	 	Cumulative
Vesting	 	 	Retention
Percentage	 	 	Annual
Delivery
Percentage	 	 	Cumulative
Delivery
Percentage	 
	 First Vesting Date
	  	 	20	% 	 	 	20	% 	 	 	25	% 	 	 	15	% 	 	 	15	% 
	 Second Vesting Date
	  	 	30	% 	 	 	50	% 	 	 	25	% 	 	 	22.5	% 	 	 	37.5	% 
	 Third Vesting Date
	  	 	50	% 	 	 	100	% 	 	 	25	% 	 	 	37.5	% 	 	 	75	% 

 (b) Delivery – Qualifying Events. 

(i) Death or Disability. Upon the occurrence of a Qualifying Event on account of the Participant’s death or
Disability, the Partnership shall, within a reasonable time following the date of such event, deliver Blackstone Holdings Partnership Units to the Participant in respect of 100% of the Deferred Units which vest and become Vested Deferred Units on
such Date and any then outstanding Retention Units (to the extent not previously delivered). 
 (ii) Retirement. Following
the occurrence of a Qualifying Event on account of the Participant’s Retirement, the Partnership shall, on each subsequent Vesting Date, deliver Blackstone Holdings Partnership Units to the Participant in respect of those Deferred Units which
vest and become Vested Deferred Units as of each following Vesting Date by application of Section 3(b)(ii); provided that the Partnership will retain 

  
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such Retention Units as are necessary to meet the Retention Percentage until such requirement lapses. In the case of any Vesting Dates after the Participant’s Retirement that occur following
the Restrictive Covenant Expiration Period, the full amount of Vested Deferred Units shall be delivered on such Vesting Dates, without any retention of Retention Units thereon. 

(c) Delivery – Terminations. Except as otherwise set forth in Section 4(b) or 4(d), in the event the
Participant’s Employment with the Partnership and its Affiliates is terminated for any reason, the Partnership shall (i) within a reasonable time of such termination, deliver Blackstone Holdings Partnership Units to the Participant in
respect of the Vested Deferred Units as of such date that are not Retention Units (if any), and (ii) deliver Blackstone Holdings Partnership Units to the Participant in respect of the Retention Units in accordance with the delivery schedule set
forth in Section 4(a), until the Holdback Delivery Date, at which point all remaining Retention Units shall be delivered to the Participant. 

(d) Forfeiture – Cause Termination or Breach of Restrictive Covenants. Notwithstanding anything to the contrary
herein, upon the termination of the Participant’s Employment by the Partnership or any of its Affiliates for Cause or upon the Participant’s breach of any of the restrictive covenants contained within an applicable Non-Competition,
Non-Solicitation and Confidentiality Agreement, all outstanding Deferred Units (whether or not vested) and Retention Units shall immediately terminate and be forfeited without consideration and no further Blackstone Holdings Partnership Units with
respect of the Award shall be delivered to the Participant or to the Participant’s legal representative, beneficiaries or heirs. Without limiting the foregoing, any Blackstone Holdings Partnership Units that have previously been
delivered to the Participant or the Participant’s legal representative, beneficiaries or heirs pursuant to the Award and which are still held by the Participant or the Participant’s legal representative, or beneficiaries or heirs as of the
date of such termination for Cause or such breach, shall also immediately terminate and be forfeited without consideration. 
 5. Change
in Control. Notwithstanding anything to the contrary herein, in the event of a Change in Control, (i) 100% of the Deferred Units granted hereunder which then remain outstanding shall vest (to the extent not previously vested) upon the date
of such Change in Control, and (ii) the Partnership shall deliver Blackstone Holdings Partnership Units to the Participant at the same times as would otherwise be delivered pursuant to Section 4(a); provided, however, if such
Change in Control (or any subsequent Change in Control) would constitute “a change in the ownership or effective control” or a “change in the ownership of a substantial portion of the assets” of the Partnership (in each case
within the meaning of Section 409A of the Code), the Partnership shall instead deliver Blackstone Holdings Partnership Units to the Participant in respect of 100% of the then outstanding Deferred Units and Retention Units (to the extent not
previously delivered) on or within 10 days following such Change in Control. 

  
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 6. Distributions. If on any date while Deferred Units are outstanding hereunder any cash
distributions shall be paid on the Blackstone Holdings Partnership Units (whether vested or unvested), the Participant shall be entitled to receive, as of such distribution date, a cash payment equal to the product of (a) the number of Deferred
Units, if any, held by the Participant as of the related distribution date, multiplied by (b) the per Blackstone Holdings Partnership Unit amount of such cash distribution. 

7. Adjustments Upon Certain Events. The Administrator shall, in its sole discretion, make certain substitutions or adjustments to any
Retention Units or Deferred Units subject to this Award Agreement pursuant to Section 9 of the Plan. 
 8. No Right to Continued
Employment. The granting of the Deferred Units evidenced by this Award Agreement shall impose no obligation on the Partnership or any Affiliate to continue the Employment of the Participant and shall not lessen or affect the Partnership’s
or its Affiliate’s right to terminate the Employment of such Participant. 
 9. No Rights of a Holder of Blackstone Holdings
Partnership Units. Except as otherwise provided herein, the Participant shall not have any rights as a holder of Blackstone Holdings Partnership Units until such Blackstone Holdings Partnership Units have been issued or transferred to the
Participant. 
 10. Restrictions. Any Blackstone Holdings Partnership Units issued or transferred to the Participant pursuant to
Section 4 of this Award Agreement shall be subject to such stop transfer orders and other restrictions as the Administrator may deem advisable under the Plan or the rules, regulations, and other requirements of the Securities and Exchange
Commission, any stock exchange upon which such Blackstone Holdings Partnership Units are listed and any applicable U.S. or non-U.S. federal, state or local laws, and the Administrator may cause a notation or notations to be put entered into the
books and records of the Partnership to make appropriate reference to such restrictions. 
 11. Transferability. Unless otherwise
determined or approved by the Administrator, no Deferred Units or Retention Units may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Participant other than by will or by the laws of descent and
distribution, and any purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance not permitted by this Section 11 shall be void and unenforceable against the Partnership or any Affiliate. 

12. Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given (and
shall be deemed to have been duly given upon receipt) by delivery in person, by courier service, by fax, or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties at the following addresses (or at such
other address for a party as shall be specified in a notice given in accordance with this Section 12): 
 (a) If to the Partnership, to:

 The Blackstone Group L.P. 

345 Park Avenue 
 New York, New
York, 10154 
 Attention: Chief Legal Officer 

Fax: (212) 583-5258 

  
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 (b) If to the Participant, to the address appearing in the personnel records of the Partnership
or any Affiliate. 
 13. Withholding. The Participant may be required to pay to the Partnership or any Affiliate and the Partnership
or any Affiliate shall have the right and is hereby authorized to withhold from any issuance or transfer due under this Agreement or under the Plan or from any compensation or other amount owing to the Participant, applicable withholding taxes with
respect to any issuance or transfer under this Award Agreement or under the Plan and to take such action as may be necessary in the opinion of the Partnership to satisfy all obligations for the payment of such withholding taxes, including, without
limitation, by reducing the number of Blackstone Holdings Partnership Units that would otherwise be transferred or issued pursuant to this Award Agreement. Without limiting the foregoing, the Administrator may, from time to time, permit the
Participant to make arrangements prior to any vesting date or delivery date described herein to pay the applicable withholding taxes by remitting a check prior to the applicable vesting or delivery date. 

14. Choice of Law. The interpretation, performance and enforcement of this Award Agreement shall be governed by the law of the State of
New York. 
 15. Subject to Plan. By entering into this Award Agreement, the Participant agrees and acknowledges that the Participant
has received and read a copy of the Plan. All Deferred Units, Retention Units and Blackstone Holdings Partnership Units issued or transferred with respect thereof are subject to the Plan. In the event of a conflict between any term or provision
contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail. 
 16.
Entire Agreement. This Award Agreement contains the entire understanding between the parties with respect to the Deferred Units granted hereunder (including, without limitation, the vesting and delivery schedules described herein), and hereby
replaces and supersedes any prior communication and arrangements between the Participant and the Partnership or any of its Affiliates with respect to the matters set forth herein and any other pre-existing economic or other arrangements between the
Participant and the Partnership or any of its Affiliates. 
 17. Modifications. Notwithstanding any provision of this Award Agreement
to the contrary, the Partnership reserves the right to modify the terms and conditions of this Award Agreement, including, without limitation, the timing or circumstances of the issuance or transfer of Blackstone Holdings Partnership Units to the
Participant hereunder, to the extent such modification is determined by the Partnership to be necessary to comply with applicable law or preserve the intended deferral of income recognition with respect to the Deferred Units and Retention Units
until the issuance or transfer of Blackstone Holdings Partnership Units hereunder. 

  
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 18. Signature in Counterparts. This Award Agreement may be signed in counterparts, each of
which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 
 [Signatures on
next page.] 

  
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 IN WITNESS WHEREOF, the parties hereto have executed this Award Agreement. 

 

	
	THE BLACKSTONE GROUP L.P.
	
	  

	Name: Stephen A Schwarzman
	
	THE PARTICIPANT
	
	  

	Name:Exhibit 10.1

 

CONSULTING AGREEMENT

 

This Consulting Agreement (“Agreement”) is made effective as of October 1, 2015 (the “Effective Date”), by and between John Golliher (“Consultant”) and Sally Beauty Holdings, Inc., a Delaware corporation (“SBH”) (collectively, the “Parties”).  Consultant and SBH agree as follows:

 

1.                                      Services.

 

i.                                          Consultant will provide professional services and advice, and work on assorted projects and other tasks as shall be directed by SBH, including but expressly not limited to:  (a) executive coaching for the President of Beauty Systems Group LLC (“BSG”) and the Managing Director of Sally Salon Services Limited; (b) proposed and potential acquisitions by BSG; and (c) additional assignments requested by SBH and accepted by Consultant (collectively, the “Services”).  Services can also consist of, but not be limited to, consulting on, and the recollection of facts and opinions related to services Golliher performed as an employee and/or officer of SBH or an SBH Affiliate(1), review of recollection on related matters, and consulting, testifying, etc. on present and future matters in dispute or litigation.  In matters involving the recollection of past events, Consultant shall make every good faith effort to be factual and accurate, and in all circumstances Consultant must remain truthful.  Although it is the intention that most of the Services shall involve the preceding areas, there may be occasions where SBH shall require Consultant to engage in other, related tasks, and Consultant similarly agrees to engage in these tasks.

 

ii.                                       Consultant understands and acknowledges that the needs of the business related to the provision of Services (including timing and duration) can be erratic and unpredictable.  Consultant shall remain available to provide such Services as may be required by SBH and it is incumbent upon Consultant to be prepared to provide Services as SBH will deem necessary, in its sole discretion.  The prior sentence notwithstanding, SBH shall reasonably attempt to accommodate any scheduling conflict Consultant may have, however, only to an extent that SBH deems reasonably possible, in its sole discretion.  Except in extraordinary SBH circumstances, Consultant shall be provided at least three days’ notice of any direction to appear.  All Services shall be performed solely by Consultant himself.

 

iii.                                    SBH and Consultant agree and expect that the total hours worked by Consultant pursuant to this Paragraph 1 shall be more than 20% of the average level of services performed by him as an employee of SBH or any SBH Affiliate over the 36-month period immediately preceding the Effective Date, and therefore Consultant shall not be considered to have separated from service with SBH for purposes of Section 409A of the Internal Revenue Code of 1986, in accordance with Treas. Reg. §1.409A-l(h)(1)(ii).

 

(1)  “SBH Affiliate” for purposes of this agreement shall mean any division, affiliate, subsidiary or other entity which has Sally Beauty Holdings, Inc. (or its predecessor or successor) as the ultimate parent company.  The list of SBH Affiliates currently includes, but is not limited to:   Sally Beauty Supply LLC, Beauty Systems Group LLC, Armstrong-McCall L.P. and Loxa Beauty LLC.

 

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2.                                      Term of Agreement.  The Term of this Agreement, and the time period during which Consultant will provide the Services, is defined as October 1, 2015 to September 30, 2017 (the “Term”).

 

3.                                      Fees, Billing. In consideration of the Services provided by Consultant, during the Term, SBH shall pay Consultant for Services at the rate of Twenty Thousand Eight Hundred Thirty-Three Dollars and Thirty-Three Cents ($20,833.33) per month (which equates to $250,000 per year).  Payments for work performed pursuant to this Agreement shall be paid to Consultant within 30 days of Consultant submitting sufficient, accurate invoices to Chris Brickman, President of Sally Beauty Holdings, Inc.  The Parties may agree to have the payments directed electronically to the account of Consultant’s choice.  Direct, out-of-pocket expenses reasonably and necessarily incurred in performing Consultant’s obligations will be invoiced at cost and consistent with SBH guidelines.  Invoices will be addressed as follows: Chris Brickman, CEO and President, Sally Beauty Holdings, Inc., 3001 Colorado Boulevard, Denton, Texas 76210, and sent by either mail or e-mail (sbhbman@sallybeauty.com).  Consultant agrees to complete and execute a Form W-9 or such other tax forms as are reasonably required by SBH. SBH will issue Consultant a Form 1099 for amounts paid, and Consultant will be responsible for payment of all applicable taxes in compliance with state and federal requirements.  Each monthly payment to Consultant for Services under this Paragraph 2 shall be considered a separate payment, as described in Treas. Reg. Section 1.409A-2(b)(2), for purposes of Section 409A of the Code.

 

4.                                      Termination of Agreement.

 

i.                                          Unless earlier terminated in accordance with the provisions hereof, this Agreement shall terminate at 11:59 p.m. on September 30, 2017 (the “Expiration Date”).  Upon the Expiration Date, this Agreement shall terminate without any liability to or upon SBH other than to pay appropriate outstanding fees for services rendered prior to the Expiration Date.

 

ii.                                       SBH may terminate this Agreement prior to that date without any liability to or upon SBH other than to pay appropriate outstanding fees for services rendered prior to the date of termination if Consultant engages in behavior or conduct constituting “Cause” is defined, for purposes of this Agreement, as: (i) Consultant’s theft or embezzlement or attempted theft or embezzlement of money or tangible or intangible assets or property of SBH or its employees or business relations; (ii) any act or acts of moral turpitude by Consultant which negatively affects the interest, property, operations, business or reputation of SBH or SBH affiliates; (iii) Consultant’s violation of a federal, state or local law or regulation which negatively affects the interest, property, operations, business or reputation of SBH or any SBH affiliate; (iv) gross negligence or willful misconduct in the performance of Consultant’s services or duties; (v) Consultant’s failure to reasonably perform any of Consultant’s services or duties as requested; and/or (vi) Consultant’s breach of this Agreement.

 

iii.                                    This Agreement shall terminate without any liability to or upon the Company other than to pay appropriate outstanding fees for services rendered prior to the date of termination on the death or “Disability” of Consultant.  For purposes of this Agreement, “Disability” shall be

 

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defined as Consultant’s inability, as determined by SBH’s CEO or President or designee in his/her reasonable discretion, in consultation with such health care professionals as he/she deems necessary, due to illness, accident, injury, physical or mental incapacity or other disability, effectively to carry out  Employee’s duties and obligations under this Agreement for 90 consecutive days or shorter periods aggregating 90 days (whether or not consecutive) during any 12 month period.

 

iv.                                   Paragraphs 6, 7, 8, 9, 10, 12, 13, 14, 15, 16, 17, 18 and 19 shall survive the termination or expiration of this Agreement.

 

5.                                      Devotion of Time. Consultant shall devote such time as is necessary for a satisfactory performance of Consultant’s duties and full and complete provision of Services, as limited in this Agreement.

 

6.                                      Title to Information. To the fullest extent allowed by applicable law, all information or materials Consultant prepares or works on for SBH or an SBH Affiliate pursuant to this Agreement shall belong to and be the exclusive property of SBH or that SBH Affiliate, free and clear from all claims of any nature relating to contributions and other efforts of Consultant and/or any agents or assistants to Consultant, including the right to copyright and/or patent the work in the name of SBH or the SBH Affiliate as author and proprietor and/or applicant and/or inventor thereof and any termination rights thereto (“SBH Work”). SBH Work includes work done with the use of information, materials, or facilities of SBH or an SBH Affiliate under this Agreement and to any extensions or renewals of this Agreement.

 

7.                                      Work for Hire. To the fullest extent allowed by applicable law, Consultant and SBH acknowledge that any and all SBH Work that Consultant prepares, completes or works on is being created under the direction and control of SBH or the relevant SBH Affiliate, and agree that any and all SBH Work: (i) shall be deemed a work made for hire by an independent contractor under the United States Copyright Laws (17 U.S.C. Section 101 et seq., and any amendments), and/or a design or other patent belonging to SBH as the party commissioning the design effort under the United States Patent Laws and any amendments; and, (ii) by virtue of this Agreement, is the sole property of SBH or the relevant SBH Affiliate, free and clear from all claims of any nature relating to contributions and other efforts of Consultant and/or any agents or assistants to Consultant, including the right to copyright and/or patent the work in the name of SBH as author and proprietor and/or applicant and/or inventor thereof and any termination rights thereto. Consultant understands and agrees that SBH or the relevant SBH Affiliate: (i) owns all right, title, and interest in any and all SBH Work; and, (b) has the right to register all copyrights or patents therein in its own name, as author or applicant and/or inventor, in the United States of America and in all foreign countries.

 

8.                                      Assignment. If any SBH Work may not, by operation of law, be works made for hire, Consultant hereby assigns to SBH or the relevant SBH Affiliate all rights in SBH Work. Consultant shall execute such other documents, and provide such assistance as SBH may reasonably request to give full effect to the provisions of this paragraph and this Agreement.

 

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9.                                      SBH Confidential Information.

 

i.                                          Consultant agrees that Consultant will receive and have access to materials and information regarding Company’s technologies, know-how, products, services and sales that are proprietary and confidential to Company, and that would give Consultant an unfair competitive advantage in competing with the Company if Consultant’s activities are not restricted as provided for in this Agreement.  Consultant recognizes that these materials and information are an important and valuable asset to SBH and that SBH has a legitimate interest in protecting the confidential and proprietary nature of these materials and information.

 

ii.                                       SBH will provide Consultant with one or more of the following: (a) access to a portion of SBH’s Confidential Information (through a computer password or other means); (b) authorization to communicate with customers and prospective customers, and reimbursement of customer development expenses in accordance with SBH policy limits, to help Consultant develop goodwill for Company; (c) authorization to communicate with manufacturers/vendors and prospective manufacturers/vendors, and reimbursement of manufacturer/vendor development expenses in accordance with SBH policy limits, to help Consultant develop relationships and/or goodwill for Company; and/or (d) authorization to participate in specialized training related to SBH’s business and customers.  Consultant understands that SBH will provide Consultant with one or more of these items in reliance upon Consultant’s promise to abide by all of the restrictions in this Agreement and that the restrictions are necessary to prevent unfair competition.

 

iii.                                    Consultant agrees that the information, observations and data obtained by Consultant during the course of Consultant’s providing Services for SBH and any relevant SBH Affiliate are the sole property of SBH or the relevant SBH Affiliate.  Consultant, on behalf of himself and any parents, subsidiaries, affiliates, employees, shareholders and officers and directors (the “Consultant Group”) agrees Consultant and Consultant Group shall not, directly or indirectly, from the date of this Agreement and thereafter, without the express written consent of SBH’s President, disclose to any person or legal entity (collectively, “Entity”) or use for Consultant’s or Consultant Group’s own account or for the benefit of any third party any Confidential Information(2), unless and only to the extent that such Confidential Information becomes generally known to and available for use by the public or in the trade other than as a result of Consultant or any member of Consultant Group’s acts or inaction or the wrongful act of any third party.  The Parties agree that Confidential Information and all elements of it are important, material, confidential and gravely affect the successful conduct of SBH and any relevant SBH Affiliate.

 

(2)    “Confidential Information” for purposes of this Agreement shall mean any and all information, relating to SBH or any relevant SBH Affiliate that is generally not disclosed outside of SBH or the relevant SBH Affiliate, and shall include but not be limited to:  SBH’s or any relevant SBH Affiliate’s business plans; strategic plans; projections; future product or market developments; marketing activities, plans, promotions, operations, research and development; financial information; information regarding suppliers and costs of products and other supplies; financing programs; information regarding personnel; information regarding operations, overhead and distribution; present or future plans related to real estate and leaseholds (including site selection); contracts with other parties; computer and communication systems, software operating systems and source codes; lawsuits, legal documents, legal strategies and the like.

 

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iv.                                   Consultant affirms that, after the end of the provision of Services, Consultant will deliver to SBH all memoranda, notes, plans, records, reports, computer disks and memory, and other documentation and copies thereof (however stored or recorded) relating to the business of SBH and any relevant SBH Affiliate, whether or not including SBH Work, and/or which contain Confidential Information, which Consultant then possesses or has custody or control of.

 

v.                                      Nothing in this Agreement is to be construed to preclude Consultant or any individual from communicating with or reporting issues to the Security and Exchange Commission or other government agencies.

 

10.                               Unfair Competition.

 

i.                                          Consultant acknowledges that this agreement with SBH will expose Consultant to Confidential Information about SBH’s business that gives Consultant unique and valuable insights that Consultant would not otherwise have about SBH’s line of business and how it operates.  Consultant further recognizes that by virtue of this agreement, and the Confidential Information (including trade secrets) provided to Consultant, Consultant will gain and/or strengthen relationships with the accounts, customers and clients of SBH, and because of such relationships and the Confidential Information, Consultant would have an unfair competitive advantage if engaged in certain post-employment/post-consulting activities (such as those restricted below) Consultant agrees that activities in violation of the restrictions provided for below would cause SBH great loss, damage, and immediate irreparable harm.  Therefore, the restrictions provided for below are reasonable and necessary for the protection of legitimate business interests of the Company.

 

ii.                                       In order to protect the substantial and important Confidential Information to which Consultant acknowledges Consultant shall have access during the course of this Agreement, Consultant hereby, on behalf of himself and the Consultant Group agrees they will remain loyal to SBH and shall not, during and for a period of two years after the termination of this Agreement, directly or indirectly, engage in “Unfair Competition.”  It shall be considered “Unfair Competition” to:

 

a.   be employed in, participate in, provide, supervise, or manage (as an employee, consultant, contractor, officer, owner, director, or otherwise) any activities or services for an entity that competes with SBH or any SBH Affiliate where the position or activity would (a) involve services that are the same as or similar in function or purpose to those Consultant Group performed, supervised, or managed for SBH or any SBH Affiliate (including but expressly not limited to chemical category positioning of new technology and growth and the like) in the last two years of Consultant’s employment with SBH and during two (2) year period preceding the termination of the Agreement or (b) would be likely to involve the use of Confidential Information.

 

b.  either directly or indirectly, solicit for employment or otherwise interfere with the relationship of SBH or any SBH Affiliate with any natural person who is then-currently employed by or otherwise engaged to perform services for SBH or any SBH Affiliate  within the Territory (for purposes of this Agreement, “Territory” is defined as anywhere SBH does business); or,

 

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c.  interfere with the business relationship between SBH or any SBH Affiliate and one of its customers operating within the Territory or suppliers operating within the Territory, by soliciting, inducing, or otherwise encouraging a customer operating within the Territory or supplier operating within the Territory of SBH or the SBH Affiliate to reduce or stop doing business with SBH or any SBH Affiliate or to instead do business with a competitor of SBH, or engaging any such SBH or SBH Affiliate customer or supplier to do business with or on Consultant’s (or the member of Consultant’s Group’s) behalf; or,

 

d.  disparage the business or interests of SBH or any SBH Affiliate (provided however, it shall not be deemed “disparagement” for Consultant to comply with its obligations in any written agreement with SBH or any SBH Affiliate); or,

 

e.  supervise any of the foregoing activities.

 

iii.                                    During the Term of this Agreement, Consultant will give SBH written notice of any offer that a member of Consultant’s Group receives from a competing business before accepting it. Consultant and Consultant’s Group will also provide SBH at least thirty (30) days’ notice before performing any services for a competing business (such as a business engaged in distribution, retail, wholesale or internet sale of beauty products) doing business within the Territory and meet with an SBH representative to discuss the nature of his new position if SBH requests such a meeting to help avoid unnecessary disputes.  The Parties understand that SBH is not required to request such a meeting and that a failure to resolve disputes through such a meeting will not be considered a waiver of any rights by either Party.

 

iv.                                   During the Term of this Agreement, SBH may notify any future or prospective third party client of Consultant of the existence of this Agreement.  Consultant stipulates that the harm caused by a violation of this Agreement would be irreparable, cannot be readily and fully remedied through monetary damages, and shall warrant injunctive relief in addition to, and not in place of, any other legal remedies available for any breach, including reasonable attorney’s fees and costs. Consultant understands and agrees that if it or another member of Consultant’s Group is found to have violated one of the restrictions on conduct created by this Agreement, the time period for that restriction will be extended by one day for each day that he is found to have been in violation of the restriction up to a maximum period of nine (9) months.

 

11.                               General Relationship. The Parties agree that Consultant is an independent contractor, whose professional services have been retained because SBH desires to accomplish certain goals. The means and method to accomplish SBH’s and any relevant SBH Affiliates’ goals in the area of Consultant’s expertise are left to the professional judgment and discretion of Consultant. Consultant alone shall be responsible for the performance of the professional services contracted for under this Agreement.

 

12.                               Consultant Responsible/Limitation of Authority. Nothing in Consultant’s reporting function, and nothing in this Agreement, is meant by the Parties to change Consultant’s independent contractor status. Consultant is responsible for, and shall indemnify SBH against, all obligations governing Consultant related to any federal or state unemployment or insurance laws, worker’s compensation laws, and payment of payroll and/or income taxes which are ordinarily paid by an independent contractor. Consultant shall not have general authority to assume or

 

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create any obligation, express or implied, on behalf of SBH or any SBH Affiliate, and Consultant shall have no authority to represent SBH or any SBH Affiliate as an agent, employee, or a party of any other capacity other than an independent contractor. Consultant shall comply with all applicable laws, rules, regulations and ordinances in the performance of this Agreement.

 

13.                               Savings Clause. Consultant understands that SBH will be irreparably harmed if the provisions of this Agreement are not strictly adhered to and agrees that SBH may apply to any court of competent jurisdiction to enjoin any violation of this Agreement.

 

14.                               Notices. All notices pertaining to this Agreement shall be in writing and transmitted by personal hand delivery, posting in the United States mail, registered, return receipt requested, or by express delivery service, or e-mail, and shall be effective upon receipt.  All notices to SBH shall be sent to:  President, Sally Beauty Holdings, Inc., 3001 Colorado Boulevard, Denton, Texas 76210, with a mandatory copy to General Counsel, Sally Beauty Holdings, Inc. (same address).  All notices to Consultant shall be sent to:  800 Carriage Court, Southlake, Texas 76092.  Either Party may change its notice address by written notice to the other.

 

15.                               Prevailing Law and Attorney’s Fees. The validity, interpretation and performance of this Agreement shall be controlled by and construed under the laws of the State of Texas in the same manner as agreements executed and fully performed in the State of Texas.  Any litigation arising out of this Agreement may be brought in an appropriate state and/or federal court serving Denton County, Texas.  In the event of litigation arising between the Parties, the ultimate prevailing party in such litigation shall be entitled to an award of reasonable attorney’s fees and other reasonable costs incurred by the prevailing party.

 

16.                               Severability. If any part of the Agreement shall be held by a court of competent jurisdiction to be contrary to law or public policy, or otherwise unenforceable, the Parties intend the remaining provisions to remain in full force and effect. If, in the opinion of any court of competent jurisdiction any covenants are not reasonable in any respect, such court shall have the right, power and authority to exercise or modify such provision or provisions of these covenants as to the court shall appear not reasonable and enforce the remainder of these covenants so amended. Provided however, that: (i) as a result of such provisions in this Agreement being declared illegal or unenforceable or their being substantially modified; or, (ii) if Consultant claims, through a lawsuit or otherwise that provisions of this Agreement are illegal, unenforceable or subject to substantial modification; and as a result of such declaration, or if in the event of such claim of Consultant being enforced, SBH loses the benefit of its bargain (such as, without limitation, the ability to procure Services, any limitation in SBH’s right to restrict Unfair Competition, any rights to SBH Work or a compromise of SBH’s rights of confidentiality), SBH shall have no further obligation under this Agreement, the Agreement shall at the option of SBH be declared void, and Consultant shall return any compensation paid for Services performed.

 

17.                               Miscellaneous. This Agreement contains the entire agreement of the Parties with respect to the subject matter hereof, and other than this Agreement, there are no agreements or understandings with respect to the subject matter thereof.  No representations were made or relied upon by either Party, other than those that are expressly set forth herein and the agreements specifically referenced in this Paragraph.  Nothing contained in this Agreement shall

 

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be construed to place the Parties in the relationship of partners or joint venturers.  No agent, employee or other representative of either Party is empowered to alter any term of this Agreement unless done in writing and signed by an authorized executive officer of SBH on the one hand, and an officer of Consultant on the other. The right of either Party to require strict performance by the other Party shall not be affected by any previous waiver, forbearance or course of dealing.  Paragraph headings in bold print are for reference only for the convenience of the Parties, and shall not be used to interpret, limit or change the terms of this Agreement.

 

18.                               Heirs, Successors, Assigns, Trustees.  This Agreement shall be binding upon and inure to the benefit of the Parties’ respective successors and assigns and trustees; provided however that in the event of death or inability to properly continue providing Services of Consultant, any right to receive further Payments shall terminate.

 

19.                               Internal Revenue Code Section 409A.  This Agreement shall be interpreted and administered in a manner so that any amount or benefit payable hereunder shall be paid or provided in a manner that is either exempt from or compliant with the requirements Section 409A of the Internal Revenue Code of 1986, as amended, and applicable Internal Revenue Service guidance and Treasury Regulations issued thereunder.

 

In witness whereof, the Parties have executed this Agreement effective as of the Effective Date.

 

	
CONSULTANT:
   JOHN GOLLIHER 
    	
 
    	
SBH:
   SALLY BEAUTY HOLDINGS, INC.: 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ John Golliher
    	
 
    	
by:
    	
/s/ Christian Brickman 
    
	
 
    	
 
    	
 
    	
Christian   Brickman 
    
	
 
    	
 
    	
 
    	
President   and Chief Executive Officer
    

 

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