Consulting Agreement
This
Consulting Agreement (“Agreement”), dated as of January 6, 2010, is entered into
by and between NorthWestern Corporation d/b/a NorthWestern Energy
(“NorthWestern” or “Company”), a Delaware corporation with its principal place
of business located at 0000 Xxxx 00xx Xxxxxx, Xxxxx Xxxxx, Xxxxx Xxxxxx, 00000,
and Xxxxxx X. Xxxxxxxx (“Xxxxxxxx” or “Consultant”), a South Dakota resident.
NorthWestern and Xxxxxxxx are collectively referred to herein as the
“Parties.”
WHEREAS,
the Company and Xxxxxxxx amicably agree to end Xxxxxxxx’x employment;
and
WHEREAS,
the Company and Xxxxxxxx have entered into a Waiver and Release to settle all
issues between the Company in connection with Xxxxxxxx’x severance of her
employment relationship with the Company; and
WHEREAS,
NorthWestern is agreeable to entering into an agreement with Xxxxxxxx for agreed
upon consulting services to NorthWestern for the period January 6, 2010, through
April 6, 2010, unless terminated by NorthWestern or by Xxxxxxxx or on the date
Xxxxxxxx has commenced other employment unless extended by mutual agreement;
and
WHEREAS,
Xxxxxxxx desires to provide certain consulting services;
NOW,
THEREFORE, in consideration of the mutual promises made herein, and for other
good and valuable consideration, the Parties hereby agree as
follows:
1. Engagement.
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a.
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NorthWestern
agrees to engage Xxxxxxxx, and Xxxxxxxx agrees to provide certain agreed
upon consulting services on behalf of NorthWestern as more fully described
in Exhibit A attached hereto and incorporated herein by reference
(“Consulting Services”). It is the intent of the Parties and it is
understood and agreed that in the performance of such Consulting Services
under the terms of this Agreement and any amendments thereto, Xxxxxxxx
shall perform such Consulting Services as an independent contractor with
respect to NorthWestern and not as an employee of NorthWestern, it being
specifically agreed that the relationship is and shall remain that of
independent parties to a contractual relationship as set forth in this
Agreement.
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b.
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The
Parties agree that NorthWestern has determined the Consulting Services to
be performed by Xxxxxxxx under this Agreement are subject to the
conditions set forth within this Agreement. Xxxxxxxx understands and
agrees that in performing such Consulting Services she may not transfer,
assign, or subcontract her obligations under this Agreement without the
express written consent of
NorthWestern.
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c.
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For
the purposes of this Agreement, it is understood and agreed by the Parties
that Xxxxxxxx shall perform the Consulting Services from her home address
in Sioux Falls or such other location as Xxxxxxxx determines or the
Company requires. Xxxxxxxx may be required to travel in performance of the
Consulting Services but only upon request of NorthWestern, with reasonable
notice. If Xxxxxxxx is required to travel outside Sioux Falls,
South Dakota, in the performance of this Agreement, NorthWestern will
reimburse Xxxxxxxx for her reasonable travel expenses upon receipt of
documentation from Xxxxxxxx, as provided in Paragraph 8 of this
Agreement.
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d.
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NorthWestern
is not responsible for payroll withholdings and shall not withhold FICA or
taxes of any kind from any payments that it owes
Xxxxxxxx.
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x.
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Xxxxxxxx
agrees that neither Xxxxxxxx nor her employees or employees of a business
entity for which Xxxxxxxx serves as an employee, partner, or other type of
owner, if any, shall be entitled to receive any benefits that employees of
NorthWestern are entitled to receive. Further, Xxxxxxxx agrees that she is
not eligible to receive and is not covered by NorthWestern workers’
compensation, unemployment compensation, health insurance, life insurance,
paid time off, paid holidays, incentive compensation, pension, profit
sharing, or any other similar employee
benefit.
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x.
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Xxxxxxxx
shall be solely responsible for paying her employees, if any, and shall be
solely responsible for paying any and all taxes, FICA, workers’
compensation, unemployment compensation, health insurance, life insurance,
paid time off, paid holidays, pension, profit sharing, or other similar
benefits for Xxxxxxxx and her employees, servants, and agents, if any.
Xxxxxxxx shall also be responsible for likewise paying any employees of a
business entity for whom Xxxxxxxx serves as an employee, partner, or other
type of owner as well as any third-party entities or individuals with whom
she may contract. Xxxxxxxx will indemnify and hold harmless NorthWestern
from any and all loss or liability, including attorney fees, arising from
her failure to make any of these payments or withholdings or to provide
these benefits, if any.
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g.
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If
the Internal Revenue Service or any other governmental agency should
question or challenge Xxxxxxxx’x independent consulting status, Xxxxxxxx
and NorthWestern shall have the right to participate in any discussion or
negotiation occurring with any agency or agencies, regardless of with whom
or by whom these discussions or negotiations are
initiated.
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2. Work. Xxxxxxxx shall
perform the work as more particularly described in Exhibit X.
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x.
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Xxxxxxxx
agrees to comply with all applicable laws, codes, and regulations and
other instructions, standards of conduct, policies, and procedures
established and/or promulgated by NorthWestern, orally or in written or
electronic form, which may be amended from time to
time.
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x.
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Xxxxxxxx
shall only report to Northwestern’s Chief Executive Officer or the
designee of the Chief Executive
Officer.
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x.
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Xxxxxxxx
shall have access to only the following NorthWestern property: Company
email system, computer equipment, BlackBerry or other PDA, mobile phone,
corporate jet, and other resources mutually agreed upon for business
purposes. Xxxxxxxx may access the PLI training during the
effective term of this Consulting
Agreement.
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3. Compensation.
Xxxxxxxx shall be paid $23,750 (Twenty Three Thousand Seven Hundred Fifty
Dollars) within the first five working days after acceptance of this Agreement
by both parties and thereafter the same amount to be paid within the first 5
(five) days after February 6, 2010 and the first 5 (five) days after March 6,
2010. These monthly payments will be made only so long as Xxxxxxxx
has not commenced employment from another party. Once Xxxxxxxx has commenced
employment from another party, this Agreement shall terminate, any payments
hereunder shall cease, and Xxxxxxxx will have no right to further payment
hereunder. A Form 1099 shall be issued in the following year for all
payments made. No deductions will be made from these payments, and Xxxxxxxx
agrees that she will be responsible for any and all tax obligations resulting
from her compensation under this Agreement. All payments to Xxxxxxxx
shall be made by direct deposit, and Xxxxxxxx shall cooperate with NorthWestern
in providing any information or documents necessary to secure such direct
deposit.
4. Intellectual
Property. Xxxxxxxx shall make no use of NorthWestern’s trademarks, trade
names, service marks, copyrights, or other intellectual property of
NorthWestern’s and will not engage in any program or activity that makes use of
or contains any reference to NorthWestern or its trademarks, trade names,
service marks, or copyrights except with written consent of NorthWestern,
expressed in a duly executed license agreement or otherwise. By executing this
Agreement, NorthWestern hereby grants Xxxxxxxx its written consent to refer to
NorthWestern in discussions and through forms, correspondence, or other
documentation provided and/or approved by NorthWestern. Consistent
with the provisions of this Agreement, Xxxxxxxx may refer to herself as a
consultant of NorthWestern, as appropriate. Xxxxxxxx shall report to
NorthWestern all violations of NorthWestern’s intellectual property and other
proprietary rights and other works immediately upon discovery of such violations
by Xxxxxxxx.
5. Covenants of
Xxxxxxxx. Xxxxxxxx covenants as follows:
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x.
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Xxxxxxxx
shall exercise reasonable efforts to not at any time, during or after the
term of this Agreement, directly or indirectly, divulge or otherwise
disclose to anyone other than an employee of NorthWestern the procedures
and policies of NorthWestern, or other information which is confidential
or proprietary to NorthWestern, unless NorthWestern gives its prior
written consent to such disclosure. NorthWestern will not
unreasonably withhold such consent. This Agreement does not
preclude Xxxxxxxx from making statements that are required by legal
process, applicable law, or a regulatory agency with jurisdiction over
her.
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b.
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All
books, records, notes, reports, copies, advertising, contracts, documents,
and other information or writings relating to NorthWestern’s business or
its customers, employees, contractors, or agents, whether prepared by
Xxxxxxxx or otherwise coming into the possession of Xxxxxxxx, are and
shall remain the exclusive property of NorthWestern and shall be returned
to NorthWestern upon termination of this Agreement or upon demand. No
copies shall be retained by Xxxxxxxx. Xxxxxxxx further agrees that upon
the completion of this Agreement, she shall return to NorthWestern, within
7 (seven) days, any and all property of NorthWestern, including, but not
limited to, any and all computers, computer equipment, BlackBerry or other
PDA, or mobile phone, and security-related equipment such as keys or key
cards.
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x.
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Xxxxxxxx
agrees that she will not make any disparaging remarks to any third parties
concerning the Company or its board members, officers, and employees.
Xxxxxxxx further agrees that she will not disparage NorthWestern’s
business capabilities, products, or plans to any customer, potential
customer, vendor, suppler, contractor, or subcontractor of NorthWestern so
as to affect adversely the goodwill or business of
NorthWestern.
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x.
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Xxxxxxxx
acknowledges that each of the foregoing matters is important and material
to the business and success of NorthWestern and agrees that any breach of
this Paragraph 5 is a material breach of this Agreement, from which
Xxxxxxxx may be enjoined and for which Xxxxxxxx shall be liable to
NorthWestern for appropriate compensatory damages which arise from the
breach, together with interest and costs. In no event shall Xxxxxxxx be
liable for any amounts, the sum of which exceed the sum of payments made
to Xxxxxxxx under this Agreement.
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6. Non-Exclusive
Agreement. The work performed for NorthWestern under this Agreement is
not intended to be exclusive. Xxxxxxxx shall be free to undertake additional
consulting activities for another party provided that such activities do not
interfere with the timely execution of the work set forth in this Agreement.
Xxxxxxxx agrees to request the consent of NorthWestern for any consulting
activities with any entity in order to ensure that a material conflict does not
exist. To the extent such conflict involves the provision of non-legal services,
NorthWestern shall not unreasonably withhold such consent.
7. Indemnification. To
the maximum extent permitted by law, Xxxxxxxx shall defend, indemnify, and hold
harmless NorthWestern and its related and affiliated companies and all
divestitures, directors, officers, and employees, and hold them from all
obligations, costs, fees, losses, liabilities, claims, judgments, actions,
damages, and expenses suffered, incurred, or sustained by NorthWestern, its
related and affiliated companies, and all their respective directors, officers,
and employees which, in connection with this Agreement, arise out of or are
related to (a) Xxxxxxxx’x
intentional wrongdoing, intentional breach of duty, fraud, and/or intentional
violation of any applicable laws, rules, and regulations of federal or state
governmental and regulatory agencies; (b) any activity
by Xxxxxxxx outside the scope of this Agreement; or (c) claims for
benefits, compensation, damages, or other amounts by any individual employed or
retained by Xxxxxxxx. Nothing about this provision shall in any way diminish or
restrict any rights or claims Xxxxxxxx may have for indemnification, including
any under the Indemnification Agreement dated November 16, 2009, between the
Parties, the Waiver and Release, or under any other agreement, statute, or
common law theory.
8. Expenses. Xxxxxxxx
shall be reimbursed by NorthWestern for reasonable and verifiable expenses
within 30 (thirty) days of presentation.
9. Term and Termination.
This Agreement is effective as of January 6, 2010, and shall continue in effect
through April 6, 2010. NorthWestern may terminate this Agreement for cause upon
written notice to Xxxxxxxx or for its convenience. Cause shall be defined as the
failure of Xxxxxxxx to cure after being provided written notification of a
breach of the terms of this Agreement, failure to fulfill the duties and
conditions of this Agreement, violation of the Company’s Code of Business
Conduct and Ethics, or a violation of any of the laws and regulations applicable
to the work within this Agreement. If NorthWestern terminates for cause, no
payments will be due Xxxxxxxx under this Agreement. In the event NorthWestern
elects to terminate this Agreement for convenience, NorthWestern shall pay
Xxxxxxxx a termination fee equal to $ 71,250.00 (Seventy One Thousand Two
Hundred Fifty Dollars), less the cumulative amount of consulting fees paid to
Xxxxxxxx prior to the termination date. In the event that Xxxxxxxx secures other
employment, Xxxxxxxx agrees to use her best efforts to negotiate terms that
would allow her to fulfill the terms of this Agreement. All such notices shall
be delivered via email, facsimile, or US mail to NorthWestern’s Chief Executive
Officer or to one of NorthWestern’s internal legal counsel at the address
indicated herein or to such other place as designated in writing by the
Parties. All such notices to Xxxxxxxx shall be delivered via email,
facsimile, or US mail to Xxxxxxxx at the address indicated herein.
10. Assignment. Xxxxxxxx
may not assign her rights or delegate her duties under this Agreement without
the prior written consent of NorthWestern. NorthWestern’s rights and obligations
under this Agreement may not be assigned or delegated without the prior written
consent of Xxxxxxxx.
11. Waiver. Waiver by
NorthWestern of any breach by Xxxxxxxx shall not operate or be construed as a
waiver of any subsequent breach by Xxxxxxxx.
12. Law, Jurisdiction, and
Venue. This Agreement shall be governed by and construed in accordance
with the laws of the State of South Dakota, without reference to conflict of
laws principles thereof. The Parties hereby irrevocably and unconditionally
submit to the jurisdiction of any South Dakota state court or any federal court
sitting in South Dakota and any appellate court from any such court, in any
suit, action, or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment resulting from any such suit, action,
or proceeding. Each party irrevocably and unconditionally agrees that all claims
in respect of any such suit, action, or proceeding may be heard and determined
in such South Dakota state court or, to the extent permitted by law, by removal
or otherwise, in such federal court.
13. Arbitration of
Disputes. Notwithstanding the parties’ consent to the jurisdiction of the
courts of South Dakota, NorthWestern and Xxxxxxxx agree to resolve any claims
they may have with each other through final and binding arbitration in
accordance with the then current arbitration rules and procedures for disputes
governing arbitrations administered by the Judicial Arbitration and Mediation
Service (JAMS); however, it need not be administered by JAMS. Either
party may commence arbitration by providing to the other party a written request
for arbitration, setting forth the subject of the dispute and the relief
requested. The parties will cooperate with one another in selecting an
arbitrator to preside over the arbitration and in scheduling the
arbitration. The Parties agree that any such arbitration shall take
place within the state of South Dakota.
14. Entire Agreement.
This Agreement constitutes the entire agreement between the Parties with respect
to the consulting arrangement between the Parties hereof and supersedes any
other agreement relating to any consulting arrangement. It specifically does not
supersede and has no effect on the Waiver and Release between the Parties, any
of Xxxxxxxx’x rights to severance benefits under that agreement, or the
Indemnification Agreement between the Parties dated November 16, 2009. This
Agreement may be modified or amended only by an instrument in writing signed by
both parties hereof.
15. Captions. The
captions stated herein are for convenience only and are not intended to alter
any of the provisions of this Agreement.
16. Severability
Provisions. In the event any one or more of the provisions contained in
this Agreement shall for any reason be held to be unenforceable in any respect
under the law of any state or of the United States, such nonenforceability shall
not affect any other provision of this Agreement, and this Agreement shall then
be construed as if such unenforceable provision or provisions had never been
contained herein.
17. Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original, and all of which, taken together, shall constitute one and the same
agreement.
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Xxxxxx
X. Xxxxxxxx
/s/ Xxxxxx X.
Xxxxxxxx
Xxxxxx
X. Xxxxxxxx
000
Xxxx Xxxxxx Xxxxx
Xxxxx
Xxxxx, XX 00000
Date: January
5, 0000
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XxxxxXxxxxxx
Xxxxxxxxxxx d/b/a NorthWestern Energy
/s/Xxxxx X.
Xxxxxxxxxx
By: Xxxxx
X. Xxxxxxxxxx
Its: VP
– Customer Care, Comm., HR
0000
Xxxx 00xx
Xxxxxx
Xxxxx
Xxxxx, XX 00000
Facsimile:
(000) 000-0000
Date: January
8, 2010
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Exhibit
A
All
requests for service by Xxxxxxxx from NorthWestern will be communicated from
NorthWestern’s Chief Executive Officer. Services will be limited to the
following:
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¨
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Operational
processes related to incidents;
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¨
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Participation
in preparation of 2009 10K;
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¨
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Participation
in preparation of 2009 proxy;
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¨
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Transitional
matters.
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Consulting Agreement Initials MEC
Page 8
of 8
