EXHIBIT 10.1
AGREEMENT FOR MANAGEMENT CONSULTING SERVICES
AGREEMENT made on this 23rd day of July, 2004, between INTEGRATED
PERFORMANCE SYSTEMS, INC. ("IPS"), a New York Corporation, with
manufacturing facilities located at 00000 XX 000, Xxxxxx, Xxxxxx Xxxxxx,
Xxxxx, and Xxxx Xxxxxx ("Consultant").
WHEREAS, IPS and Lone Star Circuits (LSC) have signed a definitive
Stock Purchase Agreement dated April 7, 2004 (the "Purchase
Agreement");
WHEREAS, IPS wishes to engage the services of the Consultant, as an
independent contractor and not as an employee, to assist in the
management of IPS in order to facilitate the performance of IPS and
LSC under their agreements.
THEREFORE, IPS engages the services of Consultant. In consideration of the
mutual promises contained in this contract, the parties hereby agree as
follows:
S1 - Term. This agreement is for a period of two (2) years, commencing on
the date of execution of this agreement. It may be terminated by either
party by giving 10 days' written notice to the other party.
This Agreement shall terminate immediately upon the closing of the Purchase
Agreement.
S2 - Services to be Rendered. Under this agreement, Consultant shall assume
the overall management responsibility for the operations of IPS and its
subsidiaries effective as of the date of execution of this Agreement.
Consultant shall be a contract manager, and shall not be named as an
officer or director pursuant to this Agreement.
S3 - Authority and Obligations
Consultant shall have the authority customarily exercised by the chief
executive officer, saving those matters requiring the expenditure of funds
beyond normal operating expenses, which require approval by the Chairman of
the Board of Directors.
Consultant shall report to the Chairman of the Board of IPS and shall keep
the Chairman informed as to his activities through the use of regular
meetings. The Chairman shall also keep Consultant informed regarding
all IPS matters and developments.
IPS shall provide full cooperation and access to its facilities, employees,
and business records.
S4 - Compensation
For services to be rendered pursuant to this Agreement, Consultant will
be entitled to a fee of $20,000.00 per month, payable, at IPS' option, in
Series C Preferred stock of IPS. Payments accrue at the end of each month
of service, are fully vested when paid, and are not contingent on either
Consultant's length of service or on performance objectives.
No compensation shall be due Consultant from IPS pursuant to this Agreement
if the Purchase Agreement closes.
While the base payment of $20,000.00 per month is not contingent on
performance milestones, in the event that IPS achieves positive earnings
before interest, depreciation, amortization, income taxes, and payments
to Consultant for either year covered by this Agreement, Consultant shall
receive Series C Preferred Stock of IPS having a redemption value of two
hundred sixty thousand ($260,000.00) dollars.
In the event the Purchase Agreement does not close (for any reason,
including, but not limited to, Consultant's delivery of a termination notice
to IPS under S3.04(g) of the Purchase Agreement), any Series C preferred
stock paid under this Agreement shall be convertible into common stock at
market price on the day of conversion. The term of such conversion right
shall be indefinite. Consultant is also granted piggyback conversion rights
in all stock received under this agreement.
S5 - Indemnification
The parties agree that Consultant will not be liable to IPS, its officers,
directors, employees, customers, vendors, or any other party with respect to
any act or omission performed by Consultant under this Agreement.
IPS agrees to indemnify Consultant if he is, or is threatened to be made
a named defendant or respondent in any threatened, pending, or completed
proceeding, whether civil, criminal, administrative, arbitrative, or
investigative, including all appeals. IPS also agrees to pay or reimburse
the expenses incurred by Consultant in connection with Consultant's
appearance as a witness or other participation in a proceeding, even
though Consultant is not a named Defendant or Respondent in the proceeding.
Indemnification will be against all expenses, including, without limitation,
attorney's fees, court costs, expert witness fees, judgments, decrees,
fines, penalties, and reasonable expenses actually incurred by Consultant
in connection with the proceeding.
S6 - No Guarantee of Performance
Consultant will perform services under this Agreement to the best of his
abilities, devoting the amount of time necessary and appropriate towards
meeting certain performance goals. However, CONSULTANT MAKES NO GUARANTEE,
AND PROVIDES NO WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO HIS
PERFORMANCE OR THE PERFORMANCE OF IPS PURSUANT TO HIS LEADERSHIP. THIS
DISCLAIMER INCLUDES ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. Consultant may be unable to improve the performance of
IPS. The failure of Consultant to meet certain performance objectives is
neither a violation of this Agreement nor does it grant a right on the part
of IPS to fail to perform its obligations under this Agreement, specifically
including, but not limited to the compensation of Consultant as described in
Section 4.
S7 - Entire Agreement
This Agreement constitutes the sole and only agreement of the parties with
respect to management services and supersedes any prior understandings or
written or oral agreements between the parties respecting this subject
matter.
S8 - Successors and Assigns
This Agreement is binding on and inures to the benefit of the parties
to it and their respective heirs, executors, administrators, legal
representatives, successors and assigns.
S9 - Attorneys Fees
If any action at law or in equity is brought to enforce or interpret the
provisions of this Agreement, the prevailing party is entitled to reasonable
attorney's fees in addition to any other relief to which he may be entitled.
S10 - Governing Law
This Agreement, and the rights and duties of the parties under it, are
governed by the laws of the State of Texas.
S11 - Amendment
This Agreement may be amended by the mutual agreement of the parties to it,
in a writing to be attached to and incorporated in this Agreement.
S12 - Construction.
In the event that any one or more of the provisions contained in this
Agreement is for any reason held to be invalid, illegal, or unenforceable
in any respect, that invalidity, illegality, or unenforceability will not
affect any other provisions, and the Agreement will be construed as if the
invalid, illegal, or unenforceable provision had never been contained in it.
SIGNED on this the 23rd day of July, 2004.
/s/ XXX XXXXX /s/ XXXX XXXXXX
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Xxx Xxxxx Xxxx Xxxxxx
President and Chairman of the Board
Integrated Performance Systems, Inc.
