EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), dated as of April 23, 1996,
between Daniel H. Levy (the "Executive") and Best Products Co., Inc., a
Virginia corporation (the "Company"), recites and provides as follows:
WHEREAS, the Board of Directors of the Company (the "Board") expects
that the Executive will make substantial contributions to the growth and
prospects of the Company; and
WHEREAS, the Board desires to obtain for the Company the services of the
Executive, and the Executive desires to be employed by the Company, all on
the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained, the Company and the Executive agree as
follows:
1. Employment.
(a) Position; Election to the Board of Directors. On the terms
and subject to the conditions set forth herein, the Company agrees to
employ the Executive as its Chief Executive Officer throughout the
Employment Term (as defined below). At the request of the Board, to the
extent consistent with the Executive's position as Chief Executive
Officer and without additional compensation, the Executive shall serve
as the President of the Company and as an officer and/or director of any
subsidiaries of the Company. In addition, the Board agrees that during
the Employment Term it shall (i) nominate the Executive for election to
the Board at each annual meeting of shareholders and use its best
efforts to cause the Executive to be duly elected to the Board at each
such meeting, and (ii) elect the Executive to the position of Chairman
of the Board.
(b) Duties and Responsibilities. The Executive shall have such
duties and responsibilities consistent with his position as the Board
determines and shall perform such duties and carry out such
responsibilities to the best of his ability for the purpose of advancing
the business of the Company and its subsidiaries. Subject to the
provisions of Section 1(c) below, during the Employment Term the
Executive shall devote his full business time, skill and attention to
the business of the Company and its subsidiaries, and, except as
specifically approved by the Board, shall not engage in any other
business activity or have any other business affiliation.
(c) Other Activities. Notwithstanding anything else to the
contrary set forth herein, as part of the Executive's business efforts
and duties on behalf of the Company, he may participate fully in social,
charitable and civic activities, and, if specifically approved by the
Board, he may serve on the boards of directors of other companies,
provided that such activities do not unreasonably interfere with the
performance of and do not involve a conflict of interest with his duties
or responsibilities hereunder. Each board of directors upon which the
Executive serves as of the date hereof is deemed to have been approved
by the Board; provided, that each such directorship shall be subject to
further review by the Board upon a material change in the business of
the subject company.
2. Employment Term. Subject to the provisions of Section 4 hereof,
the "Employment Term" hereunder shall be a constant rolling period of two (2)
years, commencing on April 23, 1996, with the result that, for each day after
April 23, 1996, the Executive's term of employment shall be extended for an
additional day so that at all times the remaining period of the Executive's
term of employment shall be two (2) years.
3. Compensation. During the Employment Term, the Company will pay
and/or otherwise provide the Executive with compensation and related benefits
as follows:
(a) Signing Bonus. In consideration of his execution of this
Agreement, the Company has paid to the Executive a signing bonus of
$650,000 (the "Signing Bonus"). The parties hereto agree that the
Signing Bonus has been earned by the Executive and that the Company
shall not be entitled to any refund or repayment of the Signing Bonus
notwithstanding any termination of the Executive's employment for any
reason whatsoever.
(b) Base Salary. During the Employment Term, the Company agrees
to pay the Executive, for services rendered hereunder, a base salary at
the annual rate of $650,000 or such higher rate as the Compensation
Committee of the Board may designate in its sole and absolute discretion
(the "Base Salary"). The Base Salary shall be payable in equal periodic
installments, not less frequently than monthly, less any sums which may
be required to be deducted or withheld under applicable provisions of
law. The Base Salary for any partial year shall be prorated based upon
the number of days elapsed in such year.
(c) Bonus. The Executive shall be entitled to an annual bonus
(the "Bonus") in respect of each fiscal year of the Company in an amount
not to exceed 75% of the Base Salary earned in such fiscal year. The
amount of Bonus payable, if any, for any fiscal year shall depend upon
the Company's actual earnings before interest, taxes, depreciation and
amortization ("EBITDA"), net earnings or other figure established by the
Board or its duly authorized designee during such year in relation to
the EBITDA, net earnings or other figure targeted in the annual business
plan approved by the Board or its duly authorized designee for such year
(the "Target Amount"), as follows: (i) 25% of the Executive's Base
Salary if the Company's performance equals 90% of the Target Amount;
(ii) 50% of the Executive's Base Salary if the Company's performance
equals the Target Amount; and (iii) 75% of the Executive's Base Salary
if the Company's performance equals or exceeds 125% of the Target
Amount. If the Company's performance falls between any of the aforesaid
levels of Target Amount, the amount of the Bonus shall be prorated. At
the beginning of each fiscal year of the Company (or as soon as
practicable thereafter), the Executive shall present to the Board for
review and approval, in its good faith judgment, an annual business plan
for such fiscal year for purposes of designating the Target Amount.
(d) Benefits. During the Employment Term (and thereafter to the
extent expressly provided herein), the Executive shall be entitled to
participate in all of the Company's employee benefit plans applicable
to, and to the same extent as, the Company's highest ranking executives,
according to the terms of those plans, except that the Executive shall
not be eligible for any severance payments (other than as provided
herein). In addition, the Executive shall be entitled to: (i) annual
vacation of four weeks with salary; and (ii) reimbursement for
reasonable business travel and entertainment expenses incurred by the
Executive, which shall be evidenced by such documentation as the Company
shall reasonably request.
(e) Executive Retirement Plan. As soon as practicable after
execution of this Agreement, the Company's Executive Retirement Plan
(the "ERP") shall be amended or otherwise modified to: (i) cause the two
year waiting period set forth in Section 2.1(b) of the ERP to be
inapplicable to the Executive's participation thereunder, with the
result that the Executive shall immediately be deemed a participant
therein; (ii) provide that the Executive's normal retirement benefit
shall be determined by reference to 12 years of vesting service; and
(iii) provide that the Executive will be credited with 8 years of
additional vesting service for purposes of calculating his benefits
under the ERP upon the earliest to occur of (x) April 23, 1999, (y) the
date of the Executive's death or disability (as defined in the ERP) and
(z) a change of control (as defined in the ERP) of the Company. The
Company shall promptly provide the Executive with a true, correct and
complete copy of such amendment, duly certified by the Secretary of the
Company as being duly adopted, in full force and effect and not further
amended.
(f) Miscellaneous. In addition to the foregoing compensation, the
Company agrees that during the Employment Term it shall: (i) provide an
automobile, selected by the Executive in his reasonable discretion, that
is owned or leased by the Company for the Executive's use, and pay all
costs and expenses regarding such automobile (including, without
limitation, gas, oil, parking, tolls, insurance, maintenance and
repairs); (ii) pay the Executive's initiation and annual membership fees
for one club of the Executive's choice within the Richmond, Virginia,
metropolitan area; and (iii) reimburse the Executive for the actual
annual expenses he incurs in connection with financial planning services
not to exceed $10,000 per year.
4. Termination of Employment.
(a) By the Company For Cause. The Company may terminate the
Executive's employment under this Agreement at any time for Cause (as
defined below) by delivery of written notice of termination to the
Executive (which notice shall specify in reasonable detail the basis
upon which such termination is made) at least ten days prior to the
termination date set forth in such notice. No such termination shall
become effective until the Executive, after receipt of such notice,
shall have been offered the opportunity to attend a meeting of the Board
of Directors of the Company at which a quorum is present (with the
Executive's counsel present and participating, if desired by the
Executive) regarding such termination notice and the allegations set
forth therein and, based upon such meeting, the Board of Directors shall
have elected to proceed with such termination. In the event the
Executive's employment is terminated for Cause, all provisions of this
Agreement (other than Paragraphs 6 through 13, and 15 through 17 hereof)
and the Employment Term shall be terminated; provided, however, that
such termination shall not divest the Executive of any previously vested
benefit or right. In addition, the Executive shall be entitled only to
payment of his earned and unpaid salary to the date of termination,
earned and unpaid bonus for the prior fiscal year, additional salary
payments in lieu of the Executive's accrued and unused vacation,
unreimbursed business and entertainment expenses in accordance with the
Company's policy, and unreimbursed medical, dental and other employee
benefit expenses incurred in accordance with the Company's employee
benefit plans (hereinafter referred to as the "Standard Termination
Payments").
(b) Upon Death or Disability. If the Executive dies, all
provisions of this Agreement (other than rights or benefits arising as
a result of such death) and the Employment Term shall be automatically
terminated; provided, however, that the Standard Termination Payments
and pro rata Bonus for the fiscal year during which such death occurs
shall be paid to the Executive's surviving spouse or, if none, his
estate, and the death benefits under the Company's employee benefit
plans shall be paid to the Executive's beneficiary or beneficiaries as
properly designated in writing by the Executive. If the Executive is
unable to perform his responsibilities under this Agreement by reason of
physical or mental disability or incapacity and such disability or
incapacity shall have continued for six consecutive months or any period
aggregating six months within any 12 consecutive months, the Company may
terminate this Agreement and the Employment Term at any time thereafter.
In such event, the Executive shall be entitled to receive his normal
compensation hereunder during said six (6) month period, and shall
thereafter be entitled to receive the Standard Termination Payments, pro
rata Bonus for the fiscal year during which such disability occurs and
such disability and other employee benefits as may be provided under the
terms of the Company's employee benefit plans. Pro rata Bonus, in the
event of the Executive's death or disability, shall be an amount equal
to the Bonus at Target Amount (regardless of the Company's actual
performance) for the fiscal year during which such death or disability
occurs, prorated by a fraction, the numerator of which is the number of
days of employment elapsed during the fiscal year prior to termination
of employment and the denominator of which is 365.
(c) By the Company Without Cause.
(i) The Company may terminate the Executive's employment
under this Agreement without Cause, and other than by reason of his
death or disability, by sending written notice of termination to
the Executive, which notice shall specify a date within 90 days
after the date of such notice as the effective date of such
termination (the "Termination Date"). From the date of such notice
through the Termination Date, the Executive shall continue to
perform the normal duties of his employment hereunder, and shall be
entitled to receive when due all compensation and benefits
applicable to the Executive hereunder. Thereafter, and within
thirty (30) days after the Termination Date, the Company shall pay
the Executive, by wire transfer of immediately available funds, an
amount equal to the Base Salary that he would have been entitled to
receive (A) for a period of 12 months following such termination,
in the event that such termination is effective on or before April
23, 1998, or (B) for a period of 24 months following such
termination, in the event that such termination is effective after
April 23, 1998. Except as set forth in Section 9(a) hereof, the
Executive shall have no obligation whatsoever to mitigate any
damages, costs or expenses suffered or incurred by the Company with
respect to the severance obligations set forth in this Section
4(c)(i), and no such severance payments received or receivable by
the Executive shall be subject to any reduction, offset, rebate or
repayment as a result of any subsequent employment or other
business activity by the Executive.
(ii) The Company shall also be obligated (A) to provide
continued coverage under the Company's medical, dental, life
insurance and total disability benefit plans or arrangements with
respect to the Executive for a period of 24 months following the
date of any termination of employment pursuant to this Section
4(c), and (B) to pay to the Executive the Standard Termination
Payments and pro rata Bonus for the fiscal year during which such
termination of employment occurs. Pro rata Bonus, in the event the
Executive's employment is terminated by the Company without Cause,
shall be an amount equal to the Bonus at Target Amount (regardless
of the Company's actual performance) for the fiscal year during
which such termination of employment occurs, pro rated by a
fraction, the numerator of which is the number of days of
employment elapsed during the fiscal year prior to termination of
employment and the denominator of which is 365. The Company's
obligation to provide continued benefits coverage in accordance
with clause (A) of this Section 4(c)(ii) shall be subject to
mitigation to the extent that substantially similar benefits are
provided by any successor employer during such continuation period.
(iii) Until April 23, 1998, the Company, at its sole cost
and expense, shall maintain an irrevocable letter of credit or
other security mutually satisfactory in form and substance to the
Company and the Executive to secure the payment by the Company of
the severance obligation set forth in clause (A) of Section 4(c)(i)
hereof. After April 23, 1998, if the Executive shall deem it to be
warranted by the financial condition of the Company, the Company,
at its sole cost and expense, shall maintain an irrevocable letter
of credit or other security mutually satisfactory in form and
substance to the Company and the Executive to secure the payment by
the Company of the severance obligation set forth in clause (B) of
Section 4(c)(i) hereof. Anything in this Section 4(c) or in any
document or instrument delivered pursuant hereto to the contrary
notwithstanding, not less than fourteen (14) days prior to the
expiration date of any letter of credit or other agreed-upon
security issued or posted in favor of the Executive hereunder, the
Company shall provide the Executive with written evidence
(reasonably satisfactory to the Executive and his counsel) that any
such letter of credit or other security has been renewed and
extended in continuing satisfaction of the Company's obligation
hereunder to provide such letter of credit or other security. If
the Executive shall fail to timely receive such written evidence,
the Executive, without any notice to the Company or any obligation
whatsoever to terminate his employment with the Company, shall have
the absolute and unrestricted right to fully draw upon such letter
of credit, or take complete ownership of such collateral, as the
case may be, and any funds realized therefrom shall be the sole and
exclusive property of the Executive as a partial or compete
prepayment of the Company's severance obligation pursuant to
Sections 4(c)(i) or 4(d) hereof; provided, however, that such funds
shall immediately be returned by the Executive to the Company
(without interest thereon) in the event the Executive's employment
is thereafter terminated under circumstances that do not entitle
the Executive to a severance payment pursuant to Sections 4(c)(i)
or 4(d) hereof.
(d) By the Executive. The Executive may terminate his
employment, and any further obligations which Executive may have to
perform services on behalf of the Company hereunder at any time after
the date hereof, by sending written notice of termination to the Company
not less than ninety (90) days prior to the effective date of such
termination. During such ninety (90) day period, the Executive shall
continue to perform the normal duties of his employment hereunder, and
shall be entitled to receive when due all compensation and benefits
applicable to the Executive hereunder. Except as provided below, if the
Executive shall elect to terminate his employment hereunder (other than
as a result of his death or disability), then the Executive shall remain
vested in all vested benefits provided for hereunder or under any
benefit plan of the Company in which Executive is a participant and
shall be entitled to receive the Standard Termination payments, but the
Company shall have no further obligation to make payments or provide
benefits to the Executive. Anything in this Agreement to the contrary
notwithstanding, the termination of the Executive's employment by the
Executive after (i) a Change of Control of the Company (as defined in
the Company's 1995 Executive Stock Option Plan) has occurred, or (ii)
the institution of bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings by or against the Company (which proceedings,
if instituted against the Company, have been consented to by the Company
or have remained undismissed for a period of 60 days) shall be deemed to
be a termination of the Executive's employment without Cause by the
Company for purposes of this Agreement, and the Executive shall be
entitled to the payments and benefits set forth in Section 4(c) above.
(e) Definition of Cause. For purposes of this Agreement, "Cause"
shall mean: (A) the misappropriation or embezzlement of corporate funds;
(B) the conviction of a felony involving moral turpitude or which in the
reasonable opinion of the Board brings the Executive into disrepute or
is likely to cause material harm to the Company's business, customer or
supplier relations, financial condition or prospects; (C) a material
violation of any statutory or common law duty of loyalty to the Company;
and (D) gross and continuing dereliction by the Executive in the
performance of his duties hereunder which is not cured or discontinued
within thirty (30) days after written notice thereof to the Executive.
5. Stock Options
(a) Grant of Options. Effective April 23, 1996, the Company
granted the Executive options to purchase seven hundred and fifty thousand
(750,000) shares of common stock of the Company (the "Options"), three
hundred thirty thousand (330,000) of which were granted pursuant to the
Company's 1994 Management Stock Option Plan (the "1994 Plan") and four
hundred twenty thousand (420,000) of which were granted pursuant to the
Company's 1995 Management Stock Option Plan (the "1995 Plan").
(b) Vesting of Options. Each Option granted to the Executive
under the 1994 Plan and the 1995 Plan provided that one half (1/2) of the
Options granted to the Executive thereunder were deemed fully vested and
nonforfeitable upon the grant of such Option and the remaining one-half (1/2)
shall become fully vested and nonforfeitable upon the earliest to occur of:
(i) April 23, 1997; (ii) any termination of the Executive's employment by the
Company without Cause; or (iii) a Change of Control of the Company (as
defined under each such Plan).
(c) Representations and Warranties of the Company. The Company
represents and warrants to the Executive as follows:
(i) the Options have been duly granted to the Executive by the
Company pursuant to the express provisions of the 1994 Plan and the 1995
Plan, respectively, and all necessary corporate action with respect
thereto has been duly taken;
(ii) the 1994 Plan and the 1995 Plan are in full force and effect
in accordance with their respective terms, and the options granted to
the Executive under each such Plan were available for grant thereunder;
(iii) the grant of the Options to the Executive does not
violate or breach any provision of the Articles of Incorporation or
Bylaws of the Company or any agreement to which the Company is subject
or by which it is bound, and no shareholder approval of such grant or
the exercise of any Options thereunder is required; and
(iv) the Options and all agreements related thereto to be entered
into by the Company shall be duly executed and delivered by the Company
and shall constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms (except
as the enforceability thereof may be limited or otherwise affected by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
generally affecting the rights of creditors and subject to general
equity principles, whether considered at law or in equity).
6. Confidential Information. The Executive understands and
acknowledges that during his employment with the Company he will be exposed
to Confidential Information (as defined below) which is proprietary and which
rightfully belongs to the Company. The Executive agrees that he will not use
or cause to be used for his own benefit, either directly or indirectly, or
disclose any of such Confidential Information at any time, either during or
after his employment with the Company, without the Company's prior written
consent. The Executive shall take all reasonable steps to safeguard such
Confidential Information that is within his possession or control and to
protect such information against disclosure, misuse, loss or theft. The
Executive's obligations under this Section with respect to any specific
Confidential Information shall cease when that specific Confidential
Information becomes publicly known or when it is disclosed by any person,
firm, corporation or business entity which is not bound by the terms of a
confidentiality agreement with the Company. The term "Confidential
Information" shall mean any information not generally known in the relevant
trade or industry, which was obtained from the Company, or which was learned
as a result of the performance of any services by the Executive on behalf of
the Company, and which falls within the following general categories:
(i) information concerning trade secrets of the Company;
(ii) information concerning existing or contemplated products,
services, technology, designs, processes and research or product
developments of the Company;
(iii) information concerning business plans, sales or
marketing methods, methods of doing business, customer lists,
customer usages and/or requirements, or supplier information of the
Company; and
(iv) any other confidential information which the Company may
reasonably have the right to protect by patent, copyright or by
keeping it secret and confidential.
7. Return of Documents. All writings, records and other documents and
things containing any Confidential Information in the Executive's custody or
possession shall be the exclusive property of the Company, shall not be
copied and/or removed from the premises of the Company, except in pursuit of
the business of the Company, and shall be delivered to the Company, without
retaining any copies, upon the termination of the Executive's employment or
at any time as requested by the Company.
8. Reaffirm Obligations. Upon termination of the Executive's
employment with the Company, the Executive shall, if requested by the
Company, reaffirm in writing Employee's recognition of the importance of
maintaining the confidentiality of the Company's proprietary information and
trade secrets and reaffirm all of the obligations set forth in Section 6 of
this Agreement.
9. Non-Compete; Non-Solicitation. The Executive agrees that:
(a) Except as is set forth below, for a period commencing on the
date hereof and ending on the date 12 months after the Executive ceases
to be employed by the Company (the "Non-Competition Period"), the
Executive shall not in the United States of America, directly or
indirectly, either for himself or any other person, own, manage,
control, participate in, invest in, permit his name to be used by, act
as consultant or advisor to, render services for (alone or in
association with any person, firm, corporation or other business
organization) or otherwise assist in any manner any entity that engages
in or owns, invests in, manages or controls any venture or enterprise
engaged in the catalog showroom and jewelry retail industry (or any
other business of the type that constitutes a substantial portion of the
Company's business at the date the Executive ceases to be employed by
the Company) (collectively, a "Competitor"); provided, however, that the
restrictions set forth above shall immediately terminate and shall be of
no further force or effect (i) in the event of a default by the Company
in the payment of any compensation or benefits to which the Executive is
entitled hereunder, which default is not cured within ten (10) days
after written notice thereof, or (ii) at the election of the Executive,
if the Executive's employment has been terminated by the Company without
Cause and if the Executive (A) gives written notice to the Company
during the Non-Competition Period that he desires to accept employment
with a Competitor, and (B) agrees that the severance payment specified
in Section 4(c)(i) hereof shall be mitigated by the amount of salary and
pro rata target bonus payable to the Executive by the Competitor and
attributable to employment during the Non-Competition Period (it being
understood that the amount of such mitigated severance shall be paid by
the Executive to the Company in a lump-sum payment within thirty (30)
days after the Executive commences employment with the Competitor).
Nothing herein shall prohibit the Executive from being a passive owner
of not more than 2% of the equity securities of a corporation engaged in
such business which is publicly traded, so long as he has no active
participation in the business of such corporation.
(b) During the Non-Competition Period, the Executive shall not,
directly or indirectly, (i) induce or attempt to induce or aid others in
inducing an employee of the Company to leave the employ of the Company,
or in any way interfere with the relationship between the Company and an
employee of the Company except in the proper exercise of the Executive's
authority, or (ii) in any way interfere with the relationship between
the Company and any customer, supplier, licensee or other business
relation of the Company.
(c) If, at the time of enforcement of this Section, a court shall
hold that the duration, scope, area or other restrictions stated herein
are unreasonable under circumstances then existing, the parties agree
that the maximum duration, scope, area or other restrictions reasonable
under such circumstances shall be substituted for the stated duration,
scope, area or other restrictions.
(d) The covenants made in this Section shall be construed as an
agreement independent of any other provision of this Agreement, and
shall survive the termination of this Agreement. Moreover, the
existence of any claim or cause of action of the Executive against the
Company or any of its affiliates, whether or not predicated upon the
terms of this Agreement, shall not constitute a defense to the
enforcement of this covenant.
10. Purchase of Former Residence; Reimbursement of Expenses.
(a) As soon as practical after the execution of this Agreement, the
Executive's residence at 3575 Mistletoe Lane, Longboat Key, Florida, shall be
appraised by a qualified independent appraiser mutually satisfactory to the
Executive and the Company to determine the fair market value thereof in an
arm's length, third party sale. As soon as practical after receipt of such
appraisal, but in no event later than fourteen (14) days after the Company's
receipt of such appraisal, the Company or its designee shall purchase such
property from the Executive for cash in an amount equal to such appraised,
fair market value, subject to customary representations and warranties as to
title and absence of liens or encumbrances.
(b) The Company shall: (i) pay the Executive an allowance of $3,000.00
per month, for a period anticipated by the parties to be approximately six
months (but ending, in any event, no later than December 31, 1996), with
respect to the Executive's expenses incurred in maintaining a temporary
residence in the Richmond, Virginia, metropolitan area pending the purchase
of permanent housing in such area by the Executive; and (ii) reimburse the
Executive promptly upon demand for the following out-of-pocket expenses
incurred by the Executive in connection with his employment by the Company:
(i) reasonable legal fees and expenses, not to exceed $10,000, incurred in
connection with the review and execution of this Agreement; (ii) moving
expenses incurred in connection with the Executive's relocation to the
Richmond, Virginia, metropolitan area; and (iii) the federal, state and local
income taxes, and the hospital insurance tax under Section 3111(b) of the
Internal Revenue Code, for which the Executive is liable on account of the
payments described in clauses (a) and (b) (i) and (ii) of this Section,
together with an amount sufficient to satisfy any additional federal, state
or local income taxes or hospital insurance tax for which the Executive is
liable on account of the amounts received pursuant to this clause (iii).
11. Representations. The Executive represents and warrants to the
Company that the execution, delivery and performance of this Agreement by the
Executive does not conflict with, or result in the breach by the Executive or
violation by the Executive of, any other agreement to which the Executive is
a party or by which the Executive is bound. The Executive hereby agrees to
indemnify the Company, its officers, directors and stockholders and hold them
harmless from and against any liability (including, without limitation,
reasonable attorneys' fees and expenses) which they may at any time suffer or
incur arising out of or relating to any breach of a representation or
warranty made by the Executive herein. The Company represents and warrants
that this Agreement and the transactions contemplated hereby have been duly
authorized by the Company by all necessary corporate and shareholder action,
and that the execution, delivery and performance of this Agreement by the
Company does not conflict with, or result in the breach or violation by the
Company of, its Articles of Incorporation or Bylaws or any other agreement to
which the Company is a party or by which it is bound. The Company hereby
agrees to indemnify the Executive and hold the Executive harmless from and
against any liability (including, without limitation, reasonable attorneys'
fees and expenses) which the Executive may at any time suffer or incur
arising out of or relating to any breach of a representation or warranty made
by the Company herein.
12. Remedies. The parties hereto agree that the Company would suffer
irreparable harm from a breach by the Executive of any of the covenants or
agreements contained herein. Therefore, in the event of the actual or
threatened breach by the Executive of any of the provisions of this
Agreement, the Company may, in addition and supplementary to other rights and
remedies existing in its favor, apply to any court of law or equity of
competent jurisdiction for specific performance and/or injunctive or other
relief in order to enforce or prevent any violation of the provisions hereof.
In the event of a breach or violation by the Executive of any of the
provisions of Section 9 hereof, the running of the Non-Competition Period
shall be tolled during the continuance of any actual breach or violation.
The Executive agrees that these restrictions are reasonable.
13. Indemnity. The Executive will be indemnified, in his capacity as
an officer and director of the Company, to the fullest extent permitted by
the Company's Articles of Incorporation and Bylaws.
14. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the Company and its affiliates and their successors
and assigns, and shall be binding upon and inure to the benefit of the
Executive and his legal representatives and assigns, provided that in no
event shall the Executive's obligations to perform services for the Company
and its affiliates be delegated or transferred by the Executive. The Company
may assign or transfer its rights hereunder to a successor corporation in the
event of a merger, consolidation or transfer or sale of all or substantially
all of the assets of the Company or of the Company's business (provided,
however, that no such assignment or transfer shall have the effect of
relieving the Company of any liability to the Executive hereunder or under
any other agreement or document contemplated herein), but only if such
assignment or transfer does not result in employment terms, conditions,
duties or responsibilities which are or may be materially different than the
terms, conditions, duties or responsibilities of the Executive hereunder.
15. Modification or Waiver. No amendment, modification, waiver,
termination or cancellation of this Agreement shall be binding or effective
for any purpose unless it is made in a writing signed by the party against
whom enforcement of such amendment, modification, waiver, termination or
cancellation is sought. No course of dealing between or among the parties to
this Agreement shall be deemed to affect or to modify, amend or discharge any
provision or term of this Agreement. No delay on the part of the Company or
the Executive in the exercise of any of their respective rights or remedies
shall operate as a waiver thereof, and no single or partial exercise by the
Company or the Executive of any such right or remedy shall preclude other or
further exercises thereof. A waiver of a right or remedy on any one occasion
shall not be construed as a bar to or waiver of any such right or remedy on
any other occasion.
16. Governing Law; Jurisdiction. This Agreement and all rights,
remedies and obligations hereunder, including, but not limited to, matters of
construction, validity and performance shall be governed by the laws of the
Commonwealth of Virginia without regard to its conflict of laws principles or
rules. To the full extent lawful, each of the Company and the Executive
hereby consents irrevocably to personal jurisdiction, service and venue in
connection with any claim or controversy arising out of this Agreement in the
courts of the Commonwealth of Virginia located in Richmond, Virginia, and in
the federal courts in the Eastern District of Virginia.
17. Severability. Whenever possible each provision and term of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision or term of this Agreement shall be
held to be prohibited by or invalid under such applicable law, then such
provision or term shall be ineffective only to the extent of such prohibition
or invalidity, without invalidating or affecting in any manner whatsoever the
remainder of such provisions or term or the remaining provisions or terms of
this Agreement.
18. Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which
taken together constitute one and the same Agreement.
19. Headings. The headings of the Sections of this Agreement are
inserted for convenience only and shall not be deemed to constitute a part
hereof and shall not affect the construction or interpretation of this
Agreement.
20. Entire Agreement. This Agreement (together with all documents and
instruments referred to herein) constitutes the entire agreement, and
supersedes all other prior agreements and undertakings, both written and
oral, among the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
BEST PRODUCTS CO., INC.
By: /s/ Donald D. Bennett
Name: Donald D. Bennett
Title: Director
EXECUTIVE
/s/ Daniel H. Levy
Daniel H. Levy