CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement") is made effective as of July 15,
1996, by and between Self-Heating Container Corporation of California, a
California corporation ("SHC"), and Manhattan West Inc., a California
corporation ("MWI" or "Consultant").
1. SERVICES OF CONSULTANT
Consultant shall locate and identify, evaluate and introduce pre-qualified
parties interested in licensing, sub-licensing, financing or joint venturing the
development or further development of technology owned or licensed by SHC.
Consultant shall also identify, locate, evaluate and introduce pre-qualified
potential distributors of the products produced or marketed by SHC. Consultant
shall assist SHC in negotiating the terms and conditions of any such licensing,
development or distribution agreements, and shall provide advice to management
regarding employment of personnel involved therein as well as matters involving
similar acquisition, finance and merger opportunities.
2. TERM OF CONSULTING AGREEMENT
Subject to Section 6 hereof, Consultant shall provide the services provided
for herein for a period of thirty (30) months from the date hereof. The parties
may choose to extend this agreement by mutual written consent.
3. COMPENSATION OF CONSULTANT
3.1 In consideration for the services to be performed by Consultant
hereunder, SHC shall pay MWI a combination of cash and stock options as follows:
(i) beginning on August 15, 1996, SHC shall pay MWI cash compensation in the
amount of Fifteen Thousand Dollars ($15,000) per month, which amount shall be
reduced to Five Thousand Dollars ($5,000) per month commencing with the payment
due on May 15, 1996, and all of which payment shall be subject to the deferred
amounts set forth in Section 3.1.1 herein ("Cash Compensation"); and (ii) issue
Consultant an option to purchase common stock of SHC (the "Option
Compensation"), more fully described in Section 3.1.2 hereinbelow.
3.1.1 DEFERRED PORTION OF CASH COMPENSATION. The parties agree
that $3,500 per month of the Cash Compensation shall be deferred until such time
as SHC has received gross proceeds of not less than Three Million Two Hundred
Thousand Dollars ($3,200,000) from the successful completion of an initial
public offering of SHC securities. Upon SHC's receipt of said gross proceeds of
the initial public offering, the deferred portion of the Cash Compensation shall
immediately become due and payable to MWI.
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3.1.2 OPTION COMPENSATION. The terms of the Option shall permit
Consultant to purchase 19,340 shares of the common stock of SHC, pursuant to the
terms and conditions of an Option Agreement ("Option Agreement") substantially
in the form attached hereto as Exhibit "A" and incorporated herein by this
reference. The Option shall be personal to Consultant and shall not be sold,
assigned, transferred, pledged, hypothecated, nor shall any interest be granted
therein, except as otherwise set forth in the Option Agreement, or agreed to in
writing by SHC.
4. CONFIDENTIAL INFORMATION
Consultant acknowledges the engagement of Consultant by SHC and the nature
of Consultant's services to SHC are confidential, and in performing the services
referenced herein Consultant shall have access to information from SHC which
both parties acknowledge is the proprietary confidential and trade secret
information of SHC, has significant value to SHC, and may constitute a
foundation upon which the business plans of SHC are based. Such information may
include by way of illustration and without limitation, financial manufacturing
and marketing data, techniques, processes, formulas, developmental or
experimental work, work in process, methods, other trade secrets (including,
without limitation, customer lists and lists of customer sources), and any other
secret or confidential information relating to the products, services,
customers, sales, or business affairs of SHC or its affiliates ("Confidential
Information"). During the term of this Agreement and at all times thereafter
Consultant shall take all acts reasonably required to maintain as confidential
and shall not disclose any Confidential Information and shall not disclose any
Confidential Information to any other person. Upon termination of this
Agreement, Consultant shall deliver to SHC all documents, records, notebooks,
work papers, and all similar material containing any information regarding SHC
or its business, whether prepared by Consultant, SHC, or anyone else.
5 RELATIONSHIP OF PARTIES
Consultant enters into this Agreement as, and shall continue to be, an
independent contractor. Under no circumstances shall Consultant look to SHC as
its employer, nor as a partner, agent, or principal. Consultant and its
employees or agents shall not be entitled to any benefits accorded to SHC's
employees, including, without limitation workers' compensation, disability
insurance, vacation or sick pay. Consultant shall be responsible for providing,
at its expense and in its name, all personnel and equipment necessary to provide
the services, as well as any licenses and permits usual or necessary for
providing the services referenced herein. Consultant shall pay, when and as
due, any and all federal, state, local, and other taxes due as a result of
Consultant's compensation hereunder, including estimated taxes, and shall
provide to SHC, upon its reasonable request, with proof of said payments.
Consultant hereby agrees to defend and indemnify SHC for any claims, losses,
costs, fees, liabilities, damages, or injuries threatened or suffered by SHC
which arise out of Consultant's breach of this Section 5.
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6. TERMINATION OF AGREEMENT
This Agreement may be terminated by SHC at any time, at its sole
discretion.
7. NOTICES
All notices and other communications required or permitted under this
Agreement shall be validly given, made, or served if in writing, and delivered
personally or sent by registered mail to:
SHC Container Corporation of California
00000 Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
with a copy to:
Xxxxxx Xxxxxxx LLP
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xx Xxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Manhattan West Inc.
000 Xxxxx Xxxxxx Xxxx., Xxxxx 00
Xxxxx Xxxxxx, XX 00000
Attn: Xxxxxxx Xxxx
or at any other address as a party may from time to time designate by
notice to the other party given in compliance with this section.
8. ATTORNEY FEES
In the event of any litigation between the parties to declare or enforce
any provision of this Agreement, the prevailing party or parties shall be
entitled to recover from the losing party or parties, in addition to any other
recovery and costs, reasonable attorney fees incurred in such litigation, in
both the trial and in all appellate courts.
9. GOVERNING LAW AND VENUE
This Agreement shall be governed by and construed in accordance with the
laws of the State of California. Venue for any action to be brought regarding
this Agreement shall be San Diego County.
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10. TITLES AND CAPTIONS
All section titles or captions contained in this Agreement are for
convenience only and shall not be deemed part of the context nor affect the
interpretation of this Agreement.
11. PRONOUNS AND PLURALS
All pronouns and any variations thereof shall be deemed to refer to the
masculine, feminine, neuter, singular, or plural as the identity of the person
or persons may require.
12. ENTIRE AGREEMENT
This Agreement and the agreements regarding the payment of fees contain
the entire understanding between and among the parties and supersedes any prior
understandings and agreements among them respecting the subject matter of this
Agreement.
13. AGREEMENT BINDING
This Agreement shall be binding upon the heirs, executors,
administrators, successors and assigns of the parties hereto.
14. ARBITRATION
If at any time during the term of this Agreement any dispute, difference,
or disagreement shall arise upon or in respect of the Agreement and the meaning
and construction hereof, every such dispute, difference, and disagreement shall
be referred to a single arbiter agreed upon by the parties, or if no single
arbiter can be agreed upon, an arbiter or arbiters shall be selected in
accordance with the rules of the American Arbitration Association in San Diego,
California, and such dispute, difference, or disagreement shall be settled by
arbitration in accordance with the then prevailing commercial rules of the
American Arbitration Association and arbitrated in San Diego, California, and
judgment upon the award rendered by the arbiter may be entered in any court
having jurisdiction thereof.
15. FURTHER ACTION
The parties hereto shall execute and deliver all documents, provide all
information, and take or forbear from all such action as may be necessary or
appropriate to achieve the purposes of the Agreement.
16. COUNTERPARTS
This Agreement may be executed in several counterparts, and all so
executed shall constitute one Agreement, binding on all the parties hereto even
though all the parties are not signatories to the original or the same
counterpart.
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17. PARTIES IN INTEREST
Nothing herein shall be construed to be to the benefit of any third
party, nor is it intended that any provision shall be for the benefit of any
third party.
18. PRESUMPTION
This Agreement or any section thereof shall not be construed against any
party due to the fact that said Agreement or any section thereof was drafted by
said party.
19. SAVINGS CLAUSE
If any provision of this Agreement, or the application of such provision
to any person or circumstance, shall be held invalid, the remainder of this
Agreement, or the application of such provision to persons or circumstances
other than those as to which it is held invalid, shall not be affected thereby.
20. INDEMNIFICATION
Each party shall hold the other harmless and shall defend and indemnify the
other and each of their past, present, and future directors, officers,
shareholders, employees, attorneys, agents, and other affiliates from and
against any loss, liability, damage, or expense, including without limitation,
reasonable attorney fees that are directly or indirectly suffered or incurred
at any time by one party, or any of such officers, directors, shareholders,
employees, attorneys, agents, or other affiliates and that arises directly or
indirectly out of or by virtue of, or directly or indirectly connected with, any
breach or failure of the other party of the representations, warranties, or
covenants contained in this Agreement or in connection with providing the
consulting services referenced herein.
Self-Heating Container Corporation of California
a California corporation
By: /s/ Xxxxx X. Xxxxxxx Date: 7-20-96
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Xxxxx X. Xxxxxxx
Title: President
Manhattan West, Inc.
a California corporation
By: /s/ Xxxxx Xxxx Date: 7-15-96
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Xxxxx Xxxx
Title: President
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EXHIBIT A
OPTION AGREEMENT
