As filed with the Securities and Exchange Commission on February 27, 1998
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------
STYLING TECHNOLOGY CORPORATION
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 75-2665378
- --------------------------------- ----------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
2390 East Camelback Road, Suite 435
Phoenix, Arizona 85016
--------------------------------------------------
(Address of Principal executive offices)(zip code)
----------
STYLING TECHNOLOGY CORPORATION
Stock Option Agreement
----------
Sam L. Leopold, Chief Executive Officer
2390 East Camelback Road,Suite 435, Phoenix, Arizona 85016
(602) 955-3353
-------------------------------------------------------------
(Telephone number, including area code, of agent for service)
This Registration Statement shall become effective immediately upon filing with
the Securities and Exchange Commission, and sales of the registered securities
will begin as soon as reasonably practicable after such effective date.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================
TITLE OF PROPOSED MAXIMUM PROPOSED MAXIMUM
SECURITIES TO AMOUNT TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
BE REGISTERED REGISTERED(1) PER SHARE PRICE REGISTRATION FEE
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock....... 90,000 shares $0.10 $9,000.00 $2.66
================================================================================================
</TABLE>
(1) This Registration Statement shall also cover any additional shares of
Common Stock which become issuable under the Stock Option Agreement, as
amended, dated June 29, 1995 between Styling Technology Corporation and
Thomas M. Clifford by reason of any stock dividend, stock split,
recapitalization or any other similar transaction without receipt of
consideration which results in an increase in the number of outstanding
shares of Common Stock of Styling Technology Corporation.
================================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The following documents or information have been filed by Styling
Technology Corporation (the "Registrant") with the Securities and Exchange
Commission (the "Commission") and are incorporated herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996;
(b) All other reports filed with the Commission pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 since the
end of the fiscal year covered by the documents of the Registrant
referred to in (a) above.
(c) The description of the Registrant's Common Stock, par value
$0.0001 per share, which is contained in the Registrant's
Registration Statement on Form 8-A (No. 0-21703) filed on
November 8, 1996 and declared effective November 12, 1996,
including any amendments or reports filed for the purpose of
updating such descriptions.
All documents and information filed by the Registrant pursuant to
Sections 13(a), 13(c), 14, and 15(d) of the Securities Exchange Act of 1934,
after the date of this Registration Statement and prior to the filing of a
post-effective amendment to this Registration Statement which indicates that all
of the securities offered under this Registration Statement have been sold or
which deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference herein and to be a part of this Registration Statement
as of the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Registration Statement
to the extent that a statement contained herein or in any other subsequently
filed document which also is incorporated or deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Under Article Eight of the Company's Certificate of Incorporation (the
"Certificate"), the Company shall indemnify and advance expenses, to the fullest
extent permitted by the Delaware General Corporation Law to each person who is
or was a director, officer or employee of the Company, or who serves or served
any other enterprise or organization at the request of the Company (an
"Indemnitee"). In addition, the Company has adopted provisions in its Bylaws
that require the Company to indemnify its directors, officers, and certain other
representatives of the Company against expenses and certain other liabilities
arising out of their conduct on behalf of the Company to the maximum extent and
under all circumstances permitted by law.
Under Delaware law, to the extent that an Indemnitee is successful on
the merits or otherwise in defense of a suit or proceeding brought against him
or her by reason of the fact that he or she is or was a director, officer or
R-1
<PAGE>
employee of the Company, or serves or served any other enterprise or
organization at the request of the Company, the Company shall indemnify him or
her against expenses (including attorneys' fees) actually and reasonably
incurred in connection with such action.
An Indemnitee also may be indemnified under Delaware law against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement if he or she acted in good faith and in a manner he or she reasonably
believed to be in, or not opposed to, the best interests of the Company, and,
with respect to any criminal action, had no reasonable cause to believe his or
her conduct was unlawful.
An Indemnitee also may be indemnified under Delaware law against
expenses (including attorneys' fees) actually and reasonably incurred in the
defense or settlement of a suit by or in the right of the Company if he or she
acted in good faith and in a manner he or she reasonably believed to be in, or
not opposed to, the best interests of the Company, except that no
indemnification may be made if the Indemnitee is adjudged to be liable to the
Company, unless a court determines that such Indemnitee is entitled to
indemnification for such expenses which the court deems proper.
Also under Delaware law, expenses incurred by an officer or director in
defending a civil or criminal action, suit or proceeding may be paid by the
Company in advance of the final disposition of the suit, action or proceeding
upon receipt of an undertaking by or on behalf of the officer or director to
repay such amount if it is ultimately determined that he or she is not entitled
to be indemnified by the Company. The Company may also advance expenses incurred
by other employees and agents of the Company upon such terms and conditions, if
any, that the Board of Directors of the Company deems appropriate.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to officers, directors or persons controlling the
Company pursuant to Delaware law or the Company's Certificate, the Company has
been informed that in the opinion of the Commission such indemnification is
against public policy as expressed in such Act and is therefore unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit Number Description
- -------------- -----------
4.1 The Company's Certificate of Incorporation, as amended, filed as Exhibits
3.1 and 3.2 to the Company's Form S-1 Registration Statement (No.
333-12469) and incorporated herein by reference.
4.2 Specimen Stock Certificate filed as Exhibit 4.1 to the Company's Form S-1
Registration Statement (No. 333-12469) and incorporated herein by
reference.
5 Opinion of O'Connor, Cavanagh, Anderson, Killingsworth & Beshears, a
Professional Association.
10.23 Stock Option Grant Agreement among and between Leopold Styling Products,
Inc., and Thomas M. Clifford, dated June 29, 1995
10.24 Separation Agreement among and between Styling Technology Corporation and
Thomas M. Clifford, dated January 16, 1998.
23.1 The consent of O'Connor, Cavanagh, Anderson, Killingsworth & Beshears, a
Professional Association, is contained in its opinion filed as Exhibit 5
hereto.
23.2 The consent of Independent Public Accountants.
24 Power of Attorney. Reference is made to page R-4 hereof.
R-2
<PAGE>
ITEM 9. UNDERTAKINGS.
1. The undersigned Registrant hereby undertakes: (1) to file, during
any period in which offers or sales are being made, a post-effective amendment
to this Registration Statement (i) to include any prospectus required by Section
10(a)(3) of the Securities Act; (ii) to reflect in the prospectus any facts or
events arising after the effective date of the Registration Statement (or the
most recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
Registration Statement. Notwithstanding the foregoing, any increase or decrease
in volume of securities offered (if the total dollar value of securities offered
would not exceed that which was registered) and any deviation from the low or
high and of the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than 20 percent
change in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and (iii) to
include any material information with respect to the plan of distribution not
previously disclosed in the Registration Statement or any material change to
such information in the Registration Statement; provided, however, that clauses
(1)(i) and (1)(ii) do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to Section 13 or Section 15(d) of the 1934 Act
that are incorporated by reference into the Registration Statement; (2) that,
for the purpose of determining any liability under the Securities Act, each such
post- effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof; and
(3) to remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of the
Stock Option Agreement dated as of June 29, 1995 between Thomas M. Clifford and
the Registrant, as amended.
2. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
1934 Act that is incorporated by reference into the Registration Statement shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
3. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
R-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Phoenix, State of Arizona, on February 24, 1998.
STYLING TECHNOLOGY CORPORATION
By /s/ Sam L. Leopold
--------------------------------------
Sam L. Leopold, Chairman of the Board
and Chief Executive Officer
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints jointly and severally, Sam L. Leopold and
Richard R. Ross, and each of them, as his true and lawful attorney-in-fact and
agents, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents, or any of them, or their or his substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Sam L. Leopold Chairman of the Board of Directors February 24, 1998
- ---------------------------- and Chief Executive Officer
Sam L. Leopold (Principal Executive Officer)
/s/ Richard R. Ross Chief Financial Officer, Treasurer, and February 24, 1998
- ---------------------------- Secretary (Principal Financial Officer)
Richard R. Ross
/s/ James A. Brooks Director February 23, 1998
- ----------------------------
James A. Brooks
/s/ Peter W. Burg Director February 24, 1998
- ----------------------------
Peter W. Burg
/s/ Michael H. Feinstein Director February 23, 1998
- ----------------------------
Michael H. Feinstein
- ---------------------------- Director February __, 1998
Sylvan Schefler
</TABLE>
R-4
EXHIBIT 5
February 27, 1998
Styling Technology Corporation
2390 E. Camelback Road, Suite 435
Phoenix, Arizona 85016
RE: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
As special legal counsel to Styling Technology Corporation, a Delaware
corporation (the "Company"), we have assisted in the preparation of the
Company's Registration Statement on Form S-8 to be filed on February 27, 1998
with the Securities and Exchange Commission (the "Registration Statement"), in
connection with the registration under the Securities Act of 1933, as amended,
of 90,000 shares of common stock, par value $.0001 per share, of the Company
(the "Shares") issuable pursuant to certain stock options granted by the Company
(the "Grant"). The facts, as we understand them, are set forth in the
Registration Statement.
With respect to the opinion set forth below, we have examined
originals, certified copies, or copies otherwise identified to our satisfaction
as being true copies, only of the following:
A. The Certificate of Incorporation of the Company, as filed with
the Secretary of State of the State of Delaware on June 29, 1995,
and amended on September 19, 1996;
B. The Bylaws of the Company, as amended through the date hereof;
C. Resolutions of the Board of Directors of the Company dated
February 23, 1998 ratifying the Grant;
D. Stock Option Agreement dated June 29, 1995 between Thomas M.
Clifford and the Company, as amended by the Separation Agreement
dated January 16, 1998 between Thomas M. Clifford and the Company
(the "Grant Agreement"); and
<PAGE>
Styling Technology Corporation
February 27, 1998
Page 2
E. The Registration Statement.
Subject to the assumptions that (i) the documents examined by us are
genuine and authentic and have been properly executed and (ii) the persons
executing the documents examined by us have the legal capacity to execute such
documents, and subject to the further limitations and qualifications set forth
below, it is our opinion that the Shares, when issued and sold in accordance
with the terms of the Grant Agreement, will be validly issued, fully paid, and
nonassessable.
Please be advised that we are members of the State Bar of Arizona, and
our opinion is limited to the legality of matters under the laws of the State of
Arizona and the General Corporation Laws of the State of Delaware. Further, our
opinion is based solely upon existing laws, rules and regulations, and we
undertake no obligation to advise you of any changes that may be brought to our
attention after the date hereof.
We hereby expressly consent to any reference to our firm in the
Registration Statement, inclusion of this Opinion as an exhibit to the
Registration Statement, and to the filing of this Opinion with any other
appropriate governmental agency.
Very truly yours,
/s/ O'Connor, Cavanagh, Anderson,
Killingsworth & Beshears,
a Professional Association
EXHIBIT 10.23
LEOPOLD STYLING PRODUCTS, INC.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (this "Agreement") is made as of
the Grant Date, as set forth on the attached Exhibit A, by and between LEOPOLD
STYLING PRODUCTS, INC., a Delaware corporation (the "Company"), and the person
listed on the attached Exhibit A (the "Optionholder").
Optionholder is a key person associated with the Company, and
the Company considers it desirable and in its best interest that Optionholder be
given an inducement to acquire a proprietary interest in the Company and added
incentive to advance the interest of the Company by possessing an option to
purchase the Company's Stock.
NOW, THEREFORE, it is agreed by and between the parties as
follows:
1. GRANT OF OPTION. The Company hereby grants to Optionholder,
as of the grant date (the "Grant Date") specified in the attached Exhibit A, the
right, privilege and option to purchase shares of Stock as set forth on the
attached Exhibit A (the "Optioned Shares"), subject in all respects to the
terms, conditions and provisions of this Agreement. It is set forth in Exhibit A
whether or not the option is intended to be an incentive stock option ("ISO") as
defined in Section 422 of the Code.
2. OPTION PRICE. The option price (the "Option Price") as
determined by the Company is set forth on the attached Exhibit A, which price
has been determined by the Company to be not less than 100 percent of the fair
market value per share of the Stock on the date of grant of this option (110
percent if an option is an ISO and the Optionholder is a stockholder who at the
date of the grant of this option owns stock possessing more than ten percent of
the combined voting power of all classes of stock of the Company or any parent
or subsidiary of the Company).
3. VESTING OF OPTION. The time at which the Optioned Shares
vest and Optionholder may exercise his granted option with respect to such
Optioned Shares shall be as described on Exhibit A attached hereto. Optioned
Shares that have vested may be acquired at any time, and from time to time, in
whole or in part, until the option expires as provided in Section 6 hereof.
4. EXERCISE OF OPTION. The option issued hereunder shall be
exercisable by written notice to the Company, addressed to the Company at its
principal place of business.
5. LOCKUP AGREEMENT. Upon the proper exercise of any option,
Optionholder may be required to agree not to sell or otherwise transfer any
acquired Optioned Shares during any stock lockup period agreed to by the Company
and any underwriter associated with such public offering.
6. TERMINATION OF OPTION. Except as otherwise set forth on
Exhibit A, this option, to the extent not previously exercised, shall terminate
upon the first to occur of the tenth anniversary of the Grant Date.
<PAGE>
7. NO PRIVILEGE OF STOCK OWNERSHIP. The holder of the option
granted hereunder shall not have any of the rights of a stockholder with respect
to the Optioned Shares until such Optionholder shall have exercised the option,
paid the Option Price, and received a stock certificate for the purchased shares
of Stock.
8. COMPLIANCE WITH LAWS AND REGULATIONS. The exercise of this
option and the issuance of the Stock upon such exercise shall be subject to
compliance by the Company and the Optionholder with all applicable requirements
of law relating thereto and with all applicable regulations of any stock
exchange in which the shares of the Stock may be listed at the time of such
exercise and issuance. In connection with the exercise of this option,
Optionholder shall execute and deliver to the Company such representations in
writing as may be requested by the Company in order for it to comply with
applicable requirements of federal and state securities laws.
9. LIABILITY OF THE COMPANY. The inability of the Company to
obtain approval from any regulatory body having authority deemed by the Company
to be necessary to the lawful issuance and sale of any Stock pursuant to this
Agreement shall relieve the Company of any liability with respect to the
nonissuance or sale of the Stock as to which such approval shall not have been
obtained. The Company, however, shall use its best efforts to obtain all such
approvals.
10. NO EMPLOYMENT OR SERVICE CONTRACT. Nothing in this
Agreement or in the Plan shall confer upon the Optionholder any right to
continue in the service of the Company (or any parent or subsidiary corporation
of the Company employing or retaining Optionholder) for any period of time or to
interfere with or otherwise restrict in any way the rights of the Company (or
any parent or subsidiary corporation of the Company employing or retaining
Optionholder) or the Optionholder, which rights are hereby expressly reserved by
each, to terminate the service of Optionholder at any time for any reason
whatsoever, with or without cause.
11. ASSIGNABILITY. Except as specifically set forth on Exhibit
A, neither this option nor any rights or privileges conferred thereby shall be
assignable or transferable by the Optionholder other than by will or by the laws
of descent and distribution, and this option shall be exercisable only by
Optionholder during the Optionholder's lifetime.
12. BINDING AFFECT. This agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective heirs, executors,
administrators, successors and assigns.
13. SECURITIES MATTERS.
(a) EXERCISE OF OPTION. The option granted hereunder
may be exercised by the Optionholder only if (i) the shares of Stock which are
to be issued upon such execution are registered under the Securities Act of
1933, as amended (the "1933 Act"), the Arizona Securities Act, as amended (the
"Arizona Act"), and the securities laws of any other applicable jurisdiction, or
(ii) the Company, upon advice of counsel, determines that the issuance of the
shares of Stock upon the exercise of the Optionholder is exempt from
registration requirements.
2
<PAGE>
(b) RESTRICTION OF SHARES. The Company is under no
obligation to register, under the 1933 Act, the Arizona Act or the securities
laws of any other jurisdiction, any of the shares of Stock to be issued to the
Optionholder upon the exercise of any option or to take any action which would
make available any exemption from registration. If the shares to be issued to
the Optionholder upon the exercise of any option have not been registered under
the 1933 Act, the Arizona Act or the securities laws of any other jurisdiction,
those shares will be "restricted securities" within the meaning of Rule 144
under the 1933 Act and must be held indefinitely without any transfer, sale or
other disposition unless (a) the shares are subsequently registered under the
1933 Act, the Arizona Act and the securities laws of any other applicable
jurisdiction, or (b) the Optionholder obtains an opinion of counsel which is
satisfactory to counsel for the Company that the shares may be sold in reliance
on an exemption from registration requirements.
14. NOTICES. Any notice required to be given or delivered
to the Company under the terms of this Agreement shall be in writing and
addressed to the Company in care of the Corporate Secretary at its principal
corporate offices. Any notice required to be given or delivered to Optionholder
at the address indicated on Exhibit A. All notices shall be deemed to have been
given or delivered upon personal delivery or upon deposit in the U.S. mail,
postage prepaid and properly addressed to the party to be notified.
15. GOVERNING LAW. The interpretation, performance,
and enforcement of this Agreement shall be governed by the laws of the State of
Arizona.
IN WITNESS WHEREOF the parties hereto have executed this
agreement or caused it to be executed on the day and year first above written.
LEOPOLD STYLING PRODUCTS, INC.
By:
------------------------------------
Name:
----------------------------------
Its:
-----------------------------------
ATTESTED BY:
- ----------------------------- -----------------------------------
Secretary Optionholder
3
<PAGE>
LEOPOLD STYLING PRODUCTS, INC.
EXHIBIT A
Optionholder: Thomas M. Clifford
Address of
Optionholder: --------------------------------------------------------------
--------------------------------------------------------------
Grant Date: June 29, 1995
Optioned Shares: 161,571
Option Price: $0.10
Check One Box:
[ ] It is intended that the options are "incentive stock options" under section
422 of the Code.
[X] It is intended that the options are nonqualified options.
Vesting Schedule
All of the options shall vest and become exercisable on June
29, 1999; provided, however, that the Company's Board of
Directors in its sole discretion may accelerate the vesting of
the options if the Company's earnings per share, calculated in
accordance with generally accepted accounting practices, for
the calendar years ended December 31, 1997 and December 31,
1998 shall exceed, in aggregate, $2.30.
EXHIBIT 10.24
SEPARATION AGREEMENT
DATED AS OF JANUARY 16, 1998
BETWEEN
STYLING TECHNOLOGY CORPORATION
AND
THOMAS M. CLIFFORD
<PAGE>
SEPARATION AGREEMENT
SEPARATION AGREEMENT effective as of the 16th day of January 1998 by
and between STYLING TECHNOLOGY CORPORATION, a Delaware corporation ("Company"),
and THOMAS M. CLIFFORD ("Clifford").
Clifford currently serves as President of Company pursuant to the terms
of an Employment Agreement dated September 19, 1996 (the "Employment
Agreement"). In addition, Clifford serves as a director of Company. Company and
Clifford also are parties to a Stock Option Agreement dated June 29, 1995 (the
"Stock Option Agreement").
Clifford and Company have determined to terminate their relationship
and the terms of the Employment Agreement and to modify the Stock Option
Agreement on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants set forth in this Agreement, the parties hereto agree as follows:
1. TERMINATION OF EMPLOYMENT AGREEMENT. Effective as of the date of
this Agreement, the Employment Agreement is cancelled and terminated in its
entirety, except for (a) the provisions of Section 5(d) relating to Confidential
Information, and (b) the provisions of Section 5(e) relating to the Return of
Books and Papers, each of which Company and Clifford agree shall remain in full
force and effect.
2. RESIGNATION AS OFFICER, DIRECTOR, AND EMPLOYEE. Clifford hereby
resigns as an officer, director, and employee of Company and each affiliate of
Company, and Company hereby accepts such resignation on behalf of itself and its
affiliates, such resignation and acceptance to be effective as of the date of
this Agreement. Until June 30, 1998, Clifford shall remain a consultant of
Company and his responsibilities shall be limited to specific transactional
activities of an executive nature reasonably requested by Company from time to
time related primarily to potential acquisitions. Clifford may, at his option,
provide such consulting services from his house. Clifford will report to and
receive instructions from the Chief Executive Officer and Chief Financial
Officer of Company.
3. PAYMENT AMOUNTS. Between the date of this Agreement and June 30,
1998, so long as Clifford does not accept employment from another company,
Company shall pay to Clifford an amount equal to $75,000 payable in accordance
with the following schedule: (a) $5,000 on January 31, 1998, (b) $10,000 on
February 28, 1998, (c) $10,000 on March 31, 1998, (d) $10,000 on April 30, 1998,
(e) $10,000 on May 30, 1998, and (f) $30,000 on June 30, 1998. Such amount shall
be in lieu of all payments that otherwise would be payable under the Employment
Agreement. All payments of this amount shall be made after deducting all
applicable federal and state payroll, FICA, unemployment, and other taxes.
<PAGE>
Company shall reimburse Clifford for all reasonable travel and entertainment
expenses and other ordinary and necessary business expenses incurred by Clifford
in connection with the business of Company and the performance of Clifford's
consulting services under paragraph 2 of this Agreement; provided, however, that
Clifford shall not incur such expenses without prior written authorization from
Company. The term "business expenses" shall not include any item not deductible
by Company for federal income tax purposes.
4. STOCK OPTIONS. The Stock Option Agreement is hereby modified so
that it covers a total of 90,000 shares of Common Stock of Company (the "Revised
Option Shares"), with the remaining 71,571 shares originally covered by the
Stock Option Agreement being immediately cancelled. Of the Revised Option
Shares, 81,000 shares shall vest immediately and 9,000 shares shall vest on
January 16, 1999, so long as Clifford has fulfilled his obligations under
paragraph 5 below for a period of one year from the date of this Agreement. The
form of notice to be given to Company by Clifford upon exercise of his options
is attached as Exhibit A. With respect to the number of Revised Option Shares,
the aggregate number of shares and the price per share shall be proportionately
adjusted for any increase or decrease in the number of outstanding shares of
stock of Company resulting from a subdivision or consolidation of shares or any
other capital adjustment or the payment of a stock dividend or other increase or
decrease in the number of such shares effected without Company's receipt of
consideration therefor in money, services, or property. Company shall file a
Registration Statement with the Securities and Exchange Commission covering the
Revised Option Shares on or before February 28, 1998 and shall use its best
efforts to cause such Registration Statement to become effective as soon as
practicable and thereafter to be available for two years from the date of this
Agreement, subject only to any lock-up period reasonably requested of him by
investment bankers with respect to the Revised Option Shares in connection with
an underwritten public offering by Company. Company represents and warrants to
Clifford that it is not currently discussing pursuing an underwritten public
offering with any investment bankers that would require Clifford to enter into a
lock-up agreement.
5. NON-DISPARAGEMENT. Neither party hereto shall publicly disparage
the other party hereto or any of the other party's directors, officers,
employees, agents, representatives, family members, heirs, successors, or
assigns, or take any action that might reasonably be expected to cause any
adverse publicity or embarrassment to any of such persons or to otherwise injure
or impair the business, reputation or prospects of any such person; provided,
however, each party shall be free to communicate with any such person regarding
the other party (when requested to do so by such person) so long as the contents
of such discussion are truthfully accurate and constitute public knowledge
otherwise than as a result of disclosures made by the party making such
communication. Company and Clifford agree to the form and content of the press
release attached hereto. Company also may make appropriate industry
announcements consistent with the contents of the press release attached hereto
but will furnish copies thereof to Clifford prior to their release.
6. MUTUAL RELEASE. Except for those obligations set forth in
this Agreement, Company hereby releases Clifford and Clifford hereby releases
2
<PAGE>
Company from any and all actions, causes of action, suits, debts, controversies,
contracts, agreements, promises, and claims (collectively, "claims"), of every
nature, character, and description, in law or in equity, known or unknown, which
they own or hold, or have at any time heretofore owned or held, or which they
hereafter can, shall, or may own or hold against the other, and each of them,
arising out of or relating to any acts or omissions occurring on or before the
date of this Agreement, including, but not limited to, any and all claims
arising out of or in any way related to the employment of Clifford by Company,
or the termination of said employment, or the directorship of Clifford with
Company, or the ownership of Clifford of any shares of or options to purchase
shares of the common stock of Company. As used in this paragraph, Company shall
include all subsidiaries, affiliates, directors, officers, attorneys, and agents
of Company, and their respective heirs, executors, administrators, successors,
and assigns, and as used in this paragraph, Clifford shall include his heirs,
executors, administrators, attorneys, agents, successors, assigns, and each of
them. In light of the intention of Company and Clifford that this release extend
to any and all claims of any kind, each of them expressly waives any and all
rights under California Civil Code Section 1542, to the extent it may apply,
which statute states as follows:
"A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him
must have materially affected his settlement with the
debtor."
7. MISCELLANEOUS.
(a) NOTICES. All notices, requests, demands and other
communications required or permitted under this Agreement shall be in writing
and shall be deemed to have been duly given, made and received (i) if personally
delivered, on the date of delivery, (ii) if mailed, three days after deposit in
the United States mail, registered or certified, return receipt requested,
postage prepaid and addressed as provided below, or (iii) if by a courier
delivery service providing overnight or "next-day" delivery, on the next
business day after deposit with such service addressed as follows:
(i) If to Company:
2390 East Camelback Road
Suite 435
Phoenix, Arizona 85016
Attention: Secretary
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with a copy to:
O'Connor, Cavanagh, Anderson, Killingsworth &
Beshears, P.A.
One East Camelback Road
Suite 1100
Phoenix, Arizona 85012
Attention: Robert S. Kant, Esq.
(ii) If to Clifford:
4618 Winnetka Avenue
Woodland Hills, California 91634
with a copy to:
Rutter Hobbs & Davidoff Incorporated
1900 Avenue of the Stars
Suite 2700
Los Angeles, California 90067-3401
Attention: Joel Weinstein, Esq.
Either party may alter the address to which communications or copies are to be
sent by giving notice of such change of address in conformity with the
provisions of this paragraph for the giving of notice.
(b) INDULGENCES; WAIVERS. Neither any failure nor any delay on
the part of either party to exercise any right, remedy, power or privilege under
this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege preclude any other or
further exercise of the same or of any other right, remedy, power or privilege,
nor shall any waiver of any right, remedy, power or privilege with respect to
any occurrence be construed as a waiver of such right, remedy, power or
privilege with respect to any other occurrence. No waiver shall be binding
unless executed in writing by the party making the waiver.
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(c) CONTROLLING LAW. This Agreement and all questions relating
to its validity, interpretation, performance and enforcement, shall be governed
by and construed in accordance with the laws of the state of Delaware,
notwithstanding any Delaware or other conflict- of-interest provisions to the
contrary.
(d) BINDING NATURE OF AGREEMENT. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective heirs,
personal representatives, successors and assigns except that no party may assign
or transfer such party's rights or obligations under this Agreement without the
prior written consent of the other party.
(e) EXECUTION IN COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original as
against each party whose signature appears thereon, and all of which shall
together constitute one and the same instrument. This Agreement shall become
binding when one or more counterparts hereof, individually or taken together,
shall bear the signatures of the parties reflected hereon as the signatories.
(f) ENTIRE AGREEMENT. This Agreement contains the entire
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior and contemporaneous agreements and
understandings, inducements and conditions, express or implied, oral or written,
except as herein contained. The express terms hereof control and supersede any
course of performance and/or usage of the trade inconsistent with any of the
terms hereof. This Agreement may not be modified or amended other than by an
agreement in writing.
(g) PARAGRAPH HEADINGS. The paragraph headings in this Agreement
are for convenience only; they form no part of this Agreement and shall not
affect its interpretation.
(h) GENDER. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context requires.
(i) NUMBER OF DAYS. In computing the number of days for purposes
of this Agreement, all days shall be counted, including Saturdays, Sundays and
holidays; provided, however, that if the final day of any time period falls on a
Saturday, Sunday or holiday, then the final day shall be deemed to be the next
day which is not a Saturday, Sunday or holiday.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
STYLING TECHNOLOGY CORPORATION
By:
----------------------------------
Name:
--------------------------------
Its:
---------------------------------
-------------------------------------
Thomas M. Clifford
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Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-8, of our reports dated March
21, 1997, June 20, 1997 and January 21, 1998, covering Styling Technology
Corporation (Styling), U.K. Abba Products, Inc., and certain product lines of
Inverness Corporation, Inc. and Inverness (UK) Limited, respectively, included
in Styling's Annual Report on Form 10-K for the year ended December 31, 1996,
and Current Reports on Form 8-K/A, filed July 29, 1997 and February 23, 1998,
respectively, and to all references to our firm included in this registration
statement.
ARTHUR ANDERSEN LLP
Phoenix, Arizona,
February 19, 1998.
