Contracts Keyed to Calamari
Sally Beauty Co. v. Nexxus Prods. Co.
Facts
On August 2, 1979, Best Barber & Beauty Supply Company, Inc. (“Best Barber”) entered into a contract with the Defendant, Nexxus Products Company (Defendant), under which Best Barber was appointed the exclusive distributor of Nexxus hair care products to hair stylists throughout Texas. The agreement contained a provision stating that termination of the distribution relationship could only occur on the anniversary date of the appointment of distributor and only with 120 days notice. In July 1981, the Plaintiff, Sally Beauty (Plaintiff), acquired Best Barber in a stock purchase transaction. Under this transaction, the Plaintiff was to succeed to all of Best Barber’s contractual rights and interests. However, the Plaintiff was a wholly-owned subsidiary of Alberto-Culver, a direct competitor of the Defendant’s. Defendant, therefore, terminated the distribution agreement. The trial court found that the distribution was not assignable because it was a personal services agreement.
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