EXHIBIT 10.4
ORANGE 21 INC.
EXECUTIVE EMPLOYMENT
AGREEMENT
This Executive Employment Agreement
(the “ Agreement ”) is entered effective
October 20 th , 2005 by and between Orange 21 Inc.,
a Delaware corporation (“ Employer ”), and Grant
Guenther (“ Employee ”), with respect to the
following facts:
A.
Whereas, Employee serves as Vice
President, Marketing of Employer;
B.
Whereas, Employer is a Delaware
corporation engaged in the business of the design, manufacture,
sale, and distribution of sunglasses and related products bearing
Employer’s trade name; and
C.
Whereas, Employer wishes to secure
and Employee wishes to provide ongoing services on the terms
and conditions set forth herein;
NOW, THEREFORE, in consideration of
the mutual covenants hereinafter set forth, the parties agree as
follows:
1.
Employment
. Employer hereby agrees to
employ Employee as its Vice President of Marketing, and Employee
hereby agrees to be employed by Employer in such capacity, subject
to the terms and conditions in this Agreement.
2.
At Will Employment
. The parties acknowledge and
agree that: (a) Employee’s employment is not for a
specified term and may be terminated by Employer or Employee at any
time with or without cause; (b) this provision is intended to
be the complete and final expression of the parties’
understanding regarding the terms and conditions under which
Employee’s employment may be terminated; (c) no
representation contrary to this provision is valid; and
(d) this provision may not be augmented, contradicted, or
modified in any way, except by a writing signed by Employee and by
Employer’s Chief Executive Officer.
3.
Compensation
. Employer shall pay Employee
the following forms of compensation:
a.
Base Salary
. Employee shall be paid a
gross annual salary of $ 120,000 (“ Base Salary
”), payable on a pro-rated basis according to
Employer’s payroll schedule and subject to applicable
withholdings and other payroll deductions. The Base Salary is
subject to adjustment at the end of each calendar year by the Board
of Directors of Orange 21 Inc. (the “ Board ”)
in its sole and absolute discretion.
b.
Commissions, Profit Sharing and
Bonuses. Each
year, in the sole and absolute discretion of the Board, Employee
may be entitled to participate in commission programs, profit
sharing programs and bonuses programs. The terms and
conditions of any such programs will be established by the Board
each year and Employee will be notified of such terms and
conditions for such year. For 2005, the terms and conditions
of such programs as such programs apply to Employee are outlined on
Exhibit A , attached hereto.
e.
Stock Options
. From time to time, in the
sole and absolute discretion of the Board, Employee may be granted
an option to purchase shares of Common Stock of Orange 21 Inc. on
terms and conditions established by the Board.
4.
Duties . As an employee of the Company, Employee
agrees: (a) to devote Employee’s utmost knowledge
and best skill to the performance of Employee’s duties under
this Agreement; (b) to devote Employee’s full business
time to the rendition of such services, subject to absences for
customary vacations and for temporary illness; and (c) not to
engage in any other gainful occupation, business, or activity that
requires Employee’s personal attention or creates a conflict
of interest with Employee’s
responsibilities under this
Agreement without the prior approval of the Chief Executive
Officer. Notwithstanding the foregoing, Employee shall be
permitted, to the extent such activities do not interfere with
his/her performance of his/her duties and responsibilities and do
not violate Section 11 of this Agreement, to serve on
civic or charitable boards or committees and serve on the boards of
other companies.
5.
Personnel Policies and
Procedures .
Employer shall have the authority to establish from time to time
personnel policies and procedures to be followed by its
employees. Employee agrees to comply with the policies and
procedures of Employer. To the extent any provisions in
Employer’s personnel policies and procedures differ from the
terms of this Agreement, the terms of this Agreement shall
control.
6.
Expenses . Employee is authorized to incur ordinary
and necessary expenses in connection with the performance of
his/her duties that are consistent with the policies of Employer as
outlined in the Employer’s Travel and Expense Guidelines,
which may from time to time be modified or amended by the Chief
Executive Officer. Employer will reimburse Employee for all
such expenses upon the presentation by Employee of an itemized
account of such expenditures with supporting documentation.
Employee agrees to submit expense reimbursement requests within
thirty (30) days after he/she incurs such expenses. In the
event that Employee fails to submit expense reimbursement requests
within the thirty (30)-day period, Employer shall have no
obligation to reimburse Employee for such expenses.
7.
Insurance . Employee shall be entitled to
participate in any insurance or other employee benefit program
maintained by Employer for the benefit of similarly situated
employees.
8.
Vacation . Employee shall be entitled to two
(2) weeks of vacation in each calendar year during the first
year of employment; three (3) weeks of vacation in each
calendar year during the second through seventh year of employment;
and four (4) weeks of vacation in each calendar year during
each subsequent years. Vacation shall be earned on a monthly
basis at a rate calculated by dividing the number of days of
vacation per year by twelve (12). For example – if the
Employee is entitled to 15 days of vacation per year, the Employee
will accrue 1.25 days of vacation for each month worked during the
year. Vacation not taken during the applicable fiscal year
shall be carried over to the following fiscal year, for a maximum
vacation accrual of six (6) weeks vacation time.
Vacation shall be taken at times consistent with the reasonable
needs of the business of Employer. Accrued but unused
vacation days shall be paid in a cash lump sum promptly after
Employee’s Termination Date, as defined in
Section 11 below.
9.
Termination
. Employee’s employment
may be terminated upon occurrence of one of the following
events:
a.
By Death . This Agreement shall automatically
terminate upon Employee’s death. Employer and Employee
shall treat termination under this Section 9(a)
as termination by Employer without cause under
Section 9(e) below with payments made to
Employee’s beneficiaries or estate, as
appropriate.
b.
By Mutual Agreement . This Agreement may be terminated
at any time by mutual agreement of the parties hereto.
Termination under this Section 9(b) shall be
treated as terminated without cause under
Section 9(e) below.
c.
Disability . If Employee is prevented from fully
performing the essential functions of Employee’s duties under
this Agreement because of any illness or physical or mental
disability, with or without reasonable accommodation, for a period
or periods of more than ninety (90) days in the aggregate during
any calendar year or thirty (30) consecutive days in any twelve
(12)-month period, Employer may terminate Employee’s
employment in its sole discretion in accordance with state and
federal law. Employer and Employee shall treat termination
under this Section 9(c) as termination by
Employer without cause under Section 9(e)
hereof.
d.
By Employer For Cause . This Agreement may be
terminated by Employer at any time for Cause. For purposes of
this Agreement, “ Cause ” shall mean, as
determined by the Chief Executive Officer in his/her sole
discretion:
(i)
Commission of a felony or any lesser
crime or offense involving fraud, embezzlement, dishonesty, breach
of trust, or breach of fiduciary duty; or
(ii)
Conduct that has caused demonstrable
and serious injury to Employer or any of its affiliates, monetary
or otherwise; or
(iii)
The order of a regulatory agency
that Employee be removed from any office, authority, or employment
with Employer; or
(iv)
Willful misconduct, refusal to
perform, or substantial disregard of duties properly assigned to
Employee by Employer; or
(v)
Breach of duty of loyalty to
Employer or any of its affiliates or other act of fraud or
dishonesty with respect to Employer or any of its affiliates;
or
(vi)
Breach by Employee of the terms of
any agreement between or among Employee and Employer.
For the avoidance of doubt,
(i) termination for death as described in
Section 9(a) , (ii) termination by mutual consent
as described in Section 9(b) or
(iii) termination for disability as described in
Section 9(c) shall not be considered
termination for Cause. “ Termination Date
” shall mean the date Employee’s employment
relationship with Employer terminates. This Agreement
terminates effective the Termination Date.
e.
By Employer Without
Cause . Employer
may, at any time, terminate Employee’s employment without
Cause and for reasons not specified above.
10.
Effect of Termination
. Upon termination of the
employment relationship, all rights of Employee under this
Agreement shall cease (but not obligations) and Employee shall
cease to be an employee of Employer. Employee shall have no
right to receive any payments or benefits hereunder except for the
following, where applicable:
a.
Employee’s Base Salary payable
pursuant to Section 3(a) hereof up to the
Termination Date, including any accrued and unused
vacation;
b.
Any commissions, profit sharing or
bonuses, in accordance with the terms established by the Board from
time to time, as provided by Section 3(b) above
(p
