CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (the "AGREEMENT") is made and
entered into as of the ____ day of December, 1998 by and between
XXXXXXXXXX/LANSING COMPANY, a Delaware corporation having its principal offices
at Xxx Xxxxxx Xxxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 (the "COMPANY"), and XXXXX X.
XXXXXXXXXXXX ("CONSULTANT").
W I T N E S S E T H:
WHEREAS, in a certain Letter of Intent (the "LETTER OF
INTENT"), dated November 4, 1998, between the Company and Streamline Industries,
Inc. ("STREAMLINE"), the Company has agreed to purchase from Streamline pursuant
to a sale of assets and assignment of contracts under Sections 363 and 365 of
the Bankruptcy Code, certain assets and executory contracts of the bankruptcy
estate of Streamline, subject to the terms and conditions of the Letter of
Intent;
WHEREAS, Consultant is the President of Streamline as of the
date hereof; and
WHEREAS, the Company desires to retain Consultant to render
consulting services to the Company, and Consultant desires to render such
services to the Company, on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. CONSULTING TERM AND DUTIES.
A. The Company hereby retains Consultant for a period of two (2)
years (the "CONSULTING PERIOD"), commencing on the Closing Date (as defined in
the Letter of Intent), subject to earlier termination as provided in Section 3
hereof. The Consulting Period may be extended by the Company, in its sole and
absolute discretion, for up to three (3) additional one-year periods (the
"ADDITIONAL YEARS"). During the Consulting Period, Consultant agrees to provide
consulting services in connection with certain projects of the Company, at the
direction of the Company; provided that (i) the Company provides Consultant with
at least thirty (30) days notice prior to commencement of such services and (ii)
Consultant and the Company agree as to the approximate length of each consulting
assignment and the approximate number of days Consultant will be engaged, on a
full-time or part-time basis, in the assignment. Notwithstanding the foregoing,
Consultant shall perform consulting services on a full-time basis at the
direction of the Company for a period of up to 120 days from and after the
Closing Date (as defined in the Letter of Intent) to assist in the transition
associated with the Company's purchase of Streamline's business, which services
shall include, but not be limited to, transition services relating to both the
Garden City and New York City facilities.
B. In addition, office space and clerical assistance will be
provided to Consultant at the Company's facilities, as may be required in
connection with the performance of Consultant's services hereunder.
2. COMPENSATION; REIMBURSEMENT.
A. As compensation for all services rendered by Consultant
hereunder, the Company shall pay Consultant One Hundred Thousand Dollars
($100,000.00) per year during the Consulting Period, which shall be payable in
equal monthly installments at the end of each month during the Consulting
Period. In the event that the Company extends the Consulting Period for an
Additional Year(s) as provided in Section 1 above, the Company shall pay
Consultant One Hundred Twenty-Five Thousand Dollars ($125,000.00) for each
Additional Year.
B. The Company agrees to reimburse Consultant for all
pre-approved out-of-pocket expenses incurred in connection with the performance
of the consulting services hereunder. Reimbursement of all such out-of-pocket
expenses shall be made by the Company to Consultant within ten (10) days of
submission to the Company of Consultant's statement(s) or receipt(s) or other
documentation reasonably satisfactory to the Company.
3. TERMINATION OF CONSULTANT.
Notwithstanding any provisions of this Agreement to the contrary,
Consultant's engagement hereunder shall terminate prior to the expiration of the
Consulting Period upon the occurrence of any of the following events: (i) the
agreement of the Company and Consultant; (ii) the Consultant's breach of any
term or condition of this Agreement; (iii) the failure of Consultant to perform
or his becoming unable to perform, by reason of death, disability or otherwise,
his duties and obligations hereunder; (iv) any act of gross negligence or
willful misconduct by Consultant; or (v) any act of theft, dishonesty or fraud
by Consultant. Upon such termination, all of the Company's obligations
hereunder, including all payment and compensation obligations, and all of
Consultant's obligations to provide services hereunder, shall immediately
terminate.
4. INDEPENDENT CONTRACTOR.
The Company hereby retains Consultant as an independent contractor and
nothing in this Agreement shall be deemed to create an employer/employee
relationship between the Company and Consultant. In that regard, and without
limiting the foregoing, Consultant shall be responsible for all taxes due as a
result of fees payable by the Company to Consultant in accordance with this
Agreement. Consultant shall have no right or authority, without the express
written consent of the Company, to bind or act on behalf of the Company with
respect to any matter whatsoever.
5. CONFIDENTIALITY.
Consultant expressly covenants and agrees that he will not at any time
from and after the date hereof, directly or indirectly, use or permit the use of
any Confidential Information (as defined below), and will not reveal, divulge,
publish or otherwise make known, such Confidential Information, to any person,
firm, association, corporation or other entity whatsoever, except (i) as may be
necessary in the performance of his duties hereunder in the best interests of
the Company and as may be authorized in writing by the Company; or (ii) as may
be compelled by a court order or similar governmental process; or (iii) where at
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the time of disclosure the specific item of Confidential Information is
generally known to the public through no fault of Consultant. As used herein,
"CONFIDENTIAL INFORMATION" shall mean any data, know-how, concepts, ideas,
plans, procedures and techniques in which the Company or any subsidiary or
affiliate of the Company has an interest, including such information relating to
the business, business plans, financial operations, employees, customers and
suppliers of the Company that Consultant knows, or reasonably should know, are
sufficiently unknown to third parties. Consultant shall promptly deliver to the
Company, upon termination or expiration of this Agreement, or at any time the
Company may so request, all Company memoranda, notes, records, reports, manuals,
computer software and all documents containing Confidential Information,
including all copies of such materials, which Consultant may then possess of
have under his control. Notwithstanding anything contained in this Agreement to
the contrary, this Section 5 shall survive the termination or expiration of this
Agreement.
6. NON-COMPETITION; NON-SOLICITATION.
A. In order to induce the Company to enter into this Agreement,
Consultant hereby expressly covenants and agrees that during the Consulting Term
and any Additional Years, and for a period of one (1) year thereafter (the
"RESTRICTED PERIOD"), he shall not, directly or indirectly, for his own account
or jointly with any other person, (i) own, manage, join, control, participate
in, consult with, render services for, or otherwise be connected with, as an
officer, employee, partner, stockholder, member, consultant, agent or otherwise
(whether paid or unpaid), any Competitor (as defined below), or in any manner
engage in activities competitive with the business of the Company, as such
business is currently conducted or as may be conducted in the future; or (ii)
intervene in or interfere with any relationships between the Company and its
customers or suppliers, prospective customers or suppliers or other business
relation of the Company; or (iii) solicit or induce or attempt to solicit or
induce any person employed by the Company or any subsidiary or affiliate of the
Company to leave such employment, whether or not such employment is pursuant to
a written contract with the Company or otherwise, or hire or attempt to hire any
person who was an employee of the Company at any time during the Restricted
Period. As used herein, "COMPETITOR" shall mean any individual, partnership,
firm, corporation or other entity or business venture that competes directly or
indirectly with the business of the Company, as currently conducted or as may be
conducted in the future by the Company.
B. If any court determines that any of the restrictive covenants
set forth in this Section 6, or any part hereof, is invalid or unenforceable,
the remainder of the restrictive covenants shall not thereby be affected and
shall be given full effect, without regard to the invalid portions. If any court
determines that any of the restrictive covenants set forth in this Section 6, or
any part thereof, is unenforceable because of the duration or geographic scope
of such provision, such court shall have to power to reduce the duration or
scope of such provision, as the case may be, and in its reduced form, such
provision shall then be enforceable.
C. Notwithstanding anything contained in this Agreement to the
contrary, this Section 6 shall survive the termination or expiration of this
Agreement.
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7. REASONABLENESS OF RESTRICTIONS.
Consultant acknowledges and agrees that the restrictive covenants
contained herein are reasonable and are necessary for the proper protection of
the business interests of the Company. Consultant acknowledges that the Company
has agreed to the terms and conditions of the Letter of Intent, in part, in
reliance on the agreements and covenants of Consultant to abide by and be bound
by the terms and provisions of this Agreement.
8. REMEDIES.
It is expressly understood and agreed that the restrictive covenants
contained in this Agreement are necessary to induce the Company to consummate
the sale contemplated by the Letter of Intent; that in the event of any breach
or threatened breach by Consultant of any covenant, obligation or other
provision contained in this Agreement, the Company, any subsidiary or affiliate
of the Company, or their successors or assigns, as the case may be, shall be
entitled (in addition to any other remedy that may be available) to institute
and prosecute any proceedings in any court of competent jurisdiction, either in
law or equity, for such relief as the Company deems appropriate, including,
without limitation, any proceedings to obtain damages for any breach of this
Agreement, to enforce the specific performance hereof by Consultant or to obtain
an injunction restraining such breach or threatened breach.
9. NOTICES.
All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed, registered
or certified mail, return receipt requested, to the parties at the addresses (or
at such other address for a party as shall be specified by like notice) set
forth on the first page of this Agreement.
10. GOVERNING LAW.
The Agreement shall be governed by and construed in accordance with the
laws of the State of New York, without regard to principles of conflict of laws.
Consultant hereby irrevocably consents to the jurisdiction of the state or
federal courts located in the County of New York, State of New York, if any
dispute arises hereunder and hereby agrees to accept service of process in any
such proceedings by mail to his address set forth on the first page of this
Agreement.
11. COMPLETE AGREEMENT.
This Agreement constitutes the entire agreement of the parties hereto
and supersedes all prior agreements and proposals, oral and written, and all
other communications between the parties relating to the subject matter
contained herein.
12. MODIFICATION.
This Agreement may only be amended, varied or modified by a written
document executed by the parties hereto.
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13. SEVERABILITY.
If any provision of this Agreement is held invalid, such invalidity
shall not affect the other provisions hereof that can be given effect without
the invalid provision and, to this end, the provisions of this Agreement are
intended to be and shall be severable.
14. WAIVER.
No failure on the part of either party to exercise any power, right,
privilege or remedy under this Agreement, and no delay on the part of either
party in exercising any power, right, privilege or remedy under this Agreement,
shall operate as a waiver of such power, right, privilege or remedy; and no
single or partial exercise of any such power, right, privilege or remedy shall
preclude any other or further exercise thereof. Neither party shall be deemed to
have waived any claim arising out of this Agreement, or any power, right,
privilege or remedy under this Agreement, unless the waiver or such claim,
power, right, privilege or remedy is expressly set forth in a written instrument
duly executed and delivered on behalf of such party; and any such waiver shall
not be applicable or have any effect except in the specific instance in which it
is given.
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15. ASSIGNMENT AND SUCCESSORS IN INTEREST.
This Agreement and all rights and obligations of Consultant hereunder
are personal to Consultant and may not be transferred or assigned by Consultant
at any time. The Company may assign its rights and obligations under this
Agreement to any subsidiary or affiliate or the Company, or to any person or
entity that assumes the Company's obligations hereunder in connection with any
sale or transfer of all or a substantial portion of the Company's assets, or to
any subsidiary, affiliate or other entity into or with which the Company is
merged or consolidated.
16. BINDING NATURE.
Subject to Section 15 hereof, this Agreement shall be binding upon and
inure to the benefit of the Company and its successors and assigns and
Consultant and his heirs, executors, administrators and personal
representatives.
17. COUNTERPARTS.
This Agreement may be executed in counterparts, each of which shall
constitute an original and, all of which when taken together shall constitute
one agreement.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
XXXXXXXXXX/LANSING COMPANY
By: ____________________________
Name:
Title:
/s/ XXXXX X. XXXXXXXXXXXX
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XXXXX X. XXXXXXXXXXXX
