CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT is dated January 21, 1997, and is between ELTRAX
SYSTEMS, INC. a Minnesota corporation ("the Company") and Xxxx X. Xxxx, an
individual residing in the State of Minnesota ("the Consultant").
A. The Company desires to retain the Consultant to perform services to
the Company.
B. The Company desires to engage the Consultant to perform certain
consulting services in order to benefit from the Consultant's
management experience and abilities, and the Consultant desires to
accept such engagement, all upon the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, the parties, each intending to be legally bound, agree
as follows:
1. ENGAGEMENT. Subject to all of the terms and conditions of this
Agreement, the Company agrees to engage the Consultant to assist the Company in
seeking out and identifying various opportunities for the Company to increase
its operations and revenues including, but not limited to, possible
acquisitions, joint ventures, marketing agreements and other growth
opportunities, as well as various management and other duties as may be agreed
to from time to time between the Board and the Consultant, and the Consultant
agrees to accept such engagement.
2. DUTIES.
a. During the term of this Agreement, the Consultant agrees to
consult with the Board and the Company regarding such matters, and to provide
such services to the Board and the Company, as may reasonably be requested by
the Board consistent with the Consultant's expertise and experience.
b. The services to be rendered by the consultant to the Company
pursuant to this Agreement will be as an independent contractor, and this
Agreement does not make the Consultant an employee, agent or legal
representative of the Company for any purpose whatsoever, including without
limitation participation in any benefits or privileges given or extended by the
Company to its employees. No right or authority is granted to the Consultant to
assume or create any obligation or responsibility, express or implied, on behalf
of or in the name of the Company. The Company will not withhold from the
amounts paid to the Consultant under this Agreement for any federal or state
taxes, and the Consultant agrees that he will pay all taxes due on such amounts
paid.
c. Notwithstanding anything to the contrary contained in this
Agreement other than in Section 7 hereof, nothing shall be construed to limit
the ability of the Consultant to consult for or serve on the Board of Directors
of such other corporations, trade associations, charitable organizations or
other entities as the Consultant shall from time to time deem appropriate and to
engage in such other activities as the Consultant shall reasonably deem not to
be in conflict with his duties to the Company.
3. TERM. Subject to earlier termination in accordance with Section
4 below and subject to the respective continuing obligations of the Company and
the Consultant under Sections 6 and 7 below, this Agreement will become
effective as of the date hereof and will remain in effect until January 21,
1998. The term of this Agreement will automatically renew for an additional one
(1) year term unless earlier terminated in accordance with Section 4 below.
This automatic annual renewal will terminate
on January 21, 2002, if the agreement has not already terminated in accordance
with Section 4 below.
4. TERMINATION. Subject to the respective continuing obligations of
the Company and the Consultant under Sections 5, 6, and 7 of this Agreement:
a. This Agreement may be terminated by the Company immediately
upon written notice to the Consultant "for cause," with the basis for
termination specified in such notice. For purposes of this Agreement, "FOR
CAUSE" will mean (i) dishonesty, fraud, gross misrepresentation, embezzlement or
material and deliberate injury or attempted injury, in each case related to the
Company or its business, (ii) any unlawful or criminal activity of a serous
nature, (iii) any willful breach of duty, habitual neglect of duty or
unreasonable job performance, or (iv) a material breach of any provision of this
Agreement.
b. This Agreement may be terminated by the Company or the
Consultant upon not less than thirty (30) days prior written notice without
cause.
c. This Agreement may be terminated by the Company ninety (90)
days following the Consultant's Total Disability. For purposes of this
Agreement, "TOTAL DISABILITY" will be as defined in the long-term disability
plan of the Company then in effect for employees of the Company (regardless of
whether the Consultant is covered by such plan) or, if no such plan exists,
"Total Disability" will mean such disability that prevents the Consultant from
performing his duties under Section 2 of this Agreement for a continuous period
of ninety (90) days.
d. This Agreement will be automatically terminated upon the
death of the Consultant.
5. COMPENSATION.
a. ANNUAL CONSULTING FEE. In consideration of the Consultant's
services under this Agreement, the Company will pay the Consultant a fee of
$2,800.00 annually, payable quarterly in arrears, commencing April 21, 1997.
b. EXPENSES. The Company will pay or reimburse the consultant
for reasonable expenses that the Consultant incurs while performing his duties
under this Agreement, whether as a Consultant, Chairman or a director, provided
that such expenses are incurred and properly accounted for in accordance with
the Company's policies regarding reimbursement of business expenses as may be in
effect from time to time.
6. CONFIDENTIAL INFORMATION.
(a) "CONFIDENTIAL INFORMATION," as used in this Agreement, means
information that is not generally known and that is proprietary to the
Company or that the Company is obligated to treat as proprietary. Any
information that the Consultant reasonably considers Confidential
Information, or that the Company treats as Confidential Information,
will be presumed to be Confidential Information (whether the
Consultant or others originated it and regardless of how the
Consultant obtained it).
(b) Except as specifically permitted by an authorized officer of
the Company or by written Company policies, the Consultant will never,
either during or after his service with the Company, use Confidential
Information for any purpose other than the business of the Company or
disclose it to any person who is not an employee of the Company. When
the Consultant's service with the Company ends, the Consultant will
promptly deliver to the
Company all records and any customer lists, compositions, articles,
devices, apparatus and other items that disclose, describe or embody
Confidential Information, including all copies, reproductions and
specimens of the Confidential Information in the Consultant's
possession, regardless of who prepared them and will promptly deliver
any other property of the Company in the Consultant's possession,
whether or not Confidential Information.
7. NON-COMPETITION. The Consultant agrees that during the term of
this Agreement, the Consultant will not alone, or in any capacity with another
firm or entity:
(a) directly or indirectly engage in any commercial activity
that competes with the Company's business within any state in the
United States or within any country in which the Company directly or
indirectly markets or services products or provides services,
(b) in any way interfere or attempt to interfere with the
Company's relationships with any of its current or potential
customers, or
(c) employ or attempt to employ any of the Company's then
employees or consultants on behalf of any other firm or entity
competing with the Company.
8. NO ADEQUATE REMEDY; NONEXCLUSIVITY. The Consultant understands
that if Consultant fails to fulfill Consultant's obligations under this
Agreement, the damages to the Company would be very difficult to determine.
Therefore, in addition to any other rights or remedies available to the Company
at law, in equity, or by statute, the Consultant hereby consents to the specific
enforcement of this Agreement by the Company through an injunction or
restraining order issued by an appropriate court.
9. MISCELLANEOUS.
(a) The Consultant represents and warrants to the Company that
neither the entering into of this Agreement nor the performance of any
of the Consultant's obligations hereunder will conflict with or
constitute a breach under any obligation of the Consultant, under any
agreement or contract to which the Consultant is a party or any other
obligation by which the Consultant is bound. Without limiting the
foregoing, the Consultant agrees that at no time will the Consultant
use any trade secrets or other intellectual property of any third
party while performing services hereunder.
(b) The services rendered by the Consultant to the Company
pursuant to this Agreement will be as an independent contractor, and
this Agreement does not make the Consultant the employee, agent or
legal representative of the Company for any purpose whatsoever. No
right or authority is granted to the Consultant to assume or to create
any obligation or responsibility, express or implied, on behalf of or
in the name of the Company. The Company will not withhold for the
Consultant any federal, state or local taxes from the amounts to be
paid to the Consultant hereunder, and the Consultant agrees that he
will pay all taxes due on such amounts.
(c) This Agreement is binding on and inures to the benefit of
the Company's successors and assigns. Because the Company is
contracting for the unique and personal skills of the Consultant, the
Consultant is precluded from assigning or delegating his rights or
duties hereunder.
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(d) This Agreement may be modified or amended only by a writing
signed by both the Company and the Consultant.
(e) The laws of the State of Minnesota will govern the validity,
construction and performance of this Agreement. Except as provided in
Section 8, any dispute, controversy or claim arising under or in
connection with this Agreement will be settled exclusively by binding
arbitration administered by the American Arbitration Association in
Minneapolis, MN in accordance with the Commercial Arbitration Rules of
the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator's award in any court having jurisdiction.
(f) Wherever possible, each provision of this Agreement will be
interpreted so that it is valid under the applicable law. If any
provision of this Agreement is to any extent invalid under the
applicable law, that provision will still be effective to the extent
it remains valid. The remainder of this Agreement also will continue
to be valid, and the entire Agreement will continue to be valid in
other jurisdictions.
(g) No failure or delay by either the Company or the Consultant
in exercising any right or remedy under this Agreement will waive any
provision of the Agreement, nor will any single or partial exercise by
either the Company or the Consultant of any right or remedy under this
Agreement preclude either of them from otherwise or further exercising
these rights or remedies, or any other rights or remedies granted by
any law or any related document.
(h) The headings in this Agreement are for convenience only and
do not affect the interpretation of this Agreement.
(i) This Agreement supersedes all previous and contemporaneous
oral negotiations, commitments, writings and understandings between
the parties concerning the matters in this Agreement, including
without limitation any policy or personnel manuals of the Company.
(j) All notices and other communications required or permitted
under this Agreement shall be in writing and shall be hand-delivered
or sent by registered or certified first-class mail, postage prepaid,
and shall be effective upon delivery if hand-delivered, or three (3)
days after mailing if mailed to the following addresses:
If to the Company: Eltrax Systems, Inc.
00000 Xxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn: President and Chief Executive
Officer
If to the Consultant: Xxxx X. Xxxx
0000 Xxxxx Xxxx
Xxxxxxxx, XX 00000
These addresses may be changed at any time by like notice.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed
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and delivered as of the day and year first above written.
ELTRAX SYSTEMS, INC. CONSULTANT
By
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Its: Xxxx X. Xxxx
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