CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement") is made by and between World Energy
Solutions, Inc., a Florida corporation ("XXX" or the "Company"), with its
principal place of business located at 0000X 00xx Xxxxxx Xxxxx, Xx. Xxxxxxxxxx,
Xxxxxxx 00000 and Xxxxxx X. Xxxxxx ("Consultant"), and is effective as of the
date set forth below. WES and Consultant may be collectively referred to herein
as the "Parties."
The Parties to this Agreement state and acknowledge as follows:
Section 1 - Recitals - The Company is engaged in the design, manufacture
and sale of transient surge suppression devices and is a provider of other goods
and services in the energy conservation and management industry.
Consultant has represented to WES that it has the skill, experience, and
expertise necessary to provide WES with the consulting services contemplated by
the Parties to this Agreement.
Based on Consultant's representation, WES desires to engage the services of
Consultant as set forth herein, and Consultant desires to provide such services
to WES pursuant to this Agreement.
In consideration of the mutual promises contained herein and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and the Consultant agree as follows:
Section 2 - Effective Date - Consultant shall begin to render consulting
services to the Company as of the date set forth below. If WES has previously
engaged Consultant, pursuant to a different agreement, this Agreement shall
supercede it, shall take priority over it, and all previous agreements relating
to the subject matter of this Agreement shall be deemed null and void except
that all prohibitions against Consultant misappropriating or misusing
confidential information, trade secrets and soliciting clients of WES shall
continue to be enforceable back to the original date of execution of such other
agreements or providing of consulting services.
Section 3 - Independent Contractor - The parties hereby acknowledge the
Consultant is an independent contractor of WES and is not authorized to act on
behalf of WES as its agent, except as may be specifically agreed otherwise.
Consultant shall have full control over the manner in which its services are
rendered hereunder. Nothing in this Agreement or the course of conduct between
the parties shall be deemed to constitute an employment, agency, joint venture,
partnership or any other type of relationship between the parties other than the
independent contractor status established hereby. Consultant shall not have the
right or power to bind WES to any contracts or agreements with any third party,
nor shall Consultant have the right or power to direct any operations of WES not
authorized specifically by WES. The relationship created by this Agreement is
that of a contract for services. Consultant shall be solely responsible for
payment of all taxes as may be imposed on any income derived by Consultant
hereunder and for any and all other liabilities arising out of Consultant's
independent status. To the extent that WES pays any taxes or other sums on
Consultant's behalf for any reason, Consultant shall promptly indemnify or
reimburse WES for any and all such sums.
Section 4 - Nature of Services and Duties - Consultant shall be available
to consult with Principal concerning all matters pertaining to the organization,
operation and administration of Principal's business activities, including,
generally, all issues of concern or import in the ongoing growth, development
and related business affairs of the Principal as may be brought to the attention
of Consultant by Principal. Specifically, Consultant shall consult with
Principal regarding the design of products for sale by WES in its business,
including the providing of product design engineering services as requested by
WES.
Consultant accepts this engagement, subject to the general supervision of
and pursuant to the orders and direction of WES. Consultant shall perform such
other duties as are requested and customarily performed by one holding such
position in other, same, or similar businesses or enterprises as that engaged in
by WES. The Consultant shall also render such other services as WES may assign
from time to time. Consultant shall report exclusively to the Chief Executive
Officer of the Company.
Section 5 - Compensation of the Consultant - WES shall compensate
Consultant for Consultant's services rendered under this Agreement, as follows:
a. ($2,300.00) Dollars per week and reported on IRS Form 1099;
b. An option to purchase 500,000 shares of restricted common stock of
the Company with a strike price of one dollar and twenty five cents ($1.25)
effective immediately upon execution of this Agreement, which option shall
be exercisable in whole or in part on October 1, 2006, but shall expire on
October 1, 2007;
c. Issuance of 100,000 shares of common stock of the Company in
connection with an offering of securities conducted by the Company pursuant
to United States Securities and Exchange Commission Form S-8; and
d. Reimbursement of WES directed and approved job related expenses,
paid as incurred, including but not limited to such expenses as travel,
vehicle mileage reimbursement, air travel expenses, lodging and meals,
automobile and equipment rentals and medical emergencies incurred during
the execution of WES business.
Section 6 - Product Manufacture, Marketing and Distribution Rights - The
Parties agree that WES shall retain the exclusive rights to manufacture, market
and distribute products designed by Consultant pursuant to this Agreement.
Consultant shall retain all rights to products that were designed by Consultant
prior to commencement of consulting services on behalf of WES or any Affiliate.
Section 7 - Restrictive Covenant -
a. WES is engaged in the design, manufacture and sale of transient
surge suppression devices and is a provider of other goods and services in
the energy conservation and management industry. Consultant expressly
covenants and agrees that during this engagement and for a period of six
(6) months following termination of the engagement, whether termination is
by WES, with or without cause, wrongful discharge, or for any other reason
whatsoever, or by Consultant (such period of time is hereinafter referred
to as the "Restrictive Period"), Consultant shall not, directly or
indirectly, for itself or himself, or on behalf of others, as an individual
on Consultant's own account, or as a partner, joint venturer, employee,
agent, salesman, contractor, officer, director or otherwise, for any
person, partnership, firm, corporation, or other entity, enter into, engage
in, accept employment from, or participate in, any business that is in
competition with the business of WES within a 200 mile radius of any
business location of WES.
b. Without limiting the restriction of Paragraph 7(a), above,
Consultant specifically agrees that during the Restrictive Period,
Paragraph 7(a) prohibits Consultant, in any of the capacities identified in
Paragraph 7(a), from soliciting and/or accepting business from WES's
customers or dealers. Consultant acknowledges and agrees that the term
"customers" includes any individual that has purchased any product or
service from WES and/or any entity that is wholly or partially owned by the
Company (all of such entities being hereinafter referred to as the
"Affiliated Entities"), that has attended any seminar or training seminar
produced or promoted by WES and/or the Affiliated Entities, or that has
otherwise responded to any advertisement disseminated by WES and/or the
Affiliated Entities.
c. This covenant is given and made by Consultant to induce WES to
engage Consultant, and Consultant acknowledges the sufficiency of
consideration for this covenant.
d. This covenant shall be construed as an agreement independent of any
other provision in this Agreement and the existence of any claim or cause
of action of Consultant against WES or any Affiliated Entity shall not
constitute a defense to the enforcement of this covenant. WES has performed
all obligations entitling it to this covenant and it is therefore not
executory or otherwise subject to rejection under the Bankruptcy Code.
e. Consultant agrees that these covenants are supported by legitimate
business interests, including, but not limited to: WES's valuable,
confidential business information and "trade secrets" as defined in
Chapters 688 and 812 of the Florida Statutes, which include, but are not
limited to, the WES's unique product designs, marketing plans, advertising
strategy and/or methodology for doing business, business plans, financial
plans, forms, training manuals and customer lists, which may have been
provided to the Consultant solely for use in WES's business, and which the
Consultant agrees have been developed through the WES's expenditure of a
great amount of time, money and effort to refine other existing plans,
forms and lists in the industry, and which the Consultant agrees contain
detailed information that could not be independently created from public
sources.
f. Consultant agrees that WES's legitimate business interests also
include, but are not limited to, extraordinary and specialized training
provided to Consultant by WES, through, among other things and
methodologies, WES's comprehensive multi-product integration approach to
energy conservation for commercial, governmental, industrial facilities and
residential structures as well as training presentations regarding same.
Consultant acknowledges and agrees that he has received extraordinary and
specialized training from WES and that without such extraordinary and
specialized training, he would be unable to successfully perform the duties
required under this Agreement.
g. Consultant agrees that this covenant is reasonably necessary to
protect the WES's legitimate business interests, including, but not limited
to, the interests identified in Sections 7(b), 7(e) and 7(f), above.
h. This covenant may be enforced by the WES's assignee or successor or
any of the Affiliated Entities and Consultant acknowledges and agrees that
the Affiliated Entities are intended beneficiaries of this Agreement.
i. If any portion of this covenant is held by an arbitration panel or
court of competent jurisdiction to be unreasonable, arbitrary or against
public policy for any reason, this covenant shall be divisible as to time,
geographic area and line of business and shall be enforceable as to a
reasonable time, area and line of business.
j. If the Consultant violates the Restrictive Covenant, in any
capacity identified herein, any and all sales by Consultant for himself,
other individual(s), partnerships, corporations, joint ventures, or any
other entity with which he is associated, shall be conclusively presumed to
have been made by the WES, but for the violation.
k. WES and Consultant agree that, should WES be granted preliminary
injunctive relief for alleged violation of Consultant of the Restrictive
Covenant, an injunction bond of no more than $2,500.00 shall be sufficient
to indemnify the Consultant for any costs or damages that he or she might
incur if the court determines that the Consultant was wrongfully enjoined.
l. Consultant agrees that any failure of WES to enforce the
Restrictive Covenant against any other Consultant, for any reason, shall
not constitute a defense to enforcement of the Restrictive Covenant.
Section 8 - Restrictive Covenant-Remedies - WES and Consultant agree that
in the event of a breach of the Restrictive Covenant, such a breach would
irreparably injure WES and would leave it with no adequate remedy at law, and if
legal proceedings should have to be brought by WES to enforce the Restrictive
Covenant, WES shall be entitled to all available civil remedies, including:
a. Temporary and permanent injunctive relief restraining the
Consultant from violating, directly or indirectly, the restrictions of the
Restrictive Covenant in any capacity identified in Section 7, supra, and
restricting third parties from aiding and abetting any violations of the
Restrictive Covenant.
b. Attorney's fees in arbitration, trial and appellate courts.
c. Costs and expenses of investigation and litigation, including
expert fees, deposition costs, bond premiums, and other costs and expenses.
d. Nothing in this Agreement shall be construed as prohibiting WES
from pursuing any other legal or equitable remedies available to it for
breach or threatened breach of the Restrictive Covenant.
Section 9 - Confidentiality Agreement - Consultant agrees to the terms of
the Confidentiality Agreement attached hereto as Addendum A and has signed that
Agreement. Consultant further acknowledges that WES owns, and neither Consultant
nor its principal acquires any proprietary interest in, WES product design and
performance data, client files, client lists, know-how, business information,
discoveries, inventions or improvements that Consultant develops while engaged
by WES and agrees that Consultant will provide all such information to WES for
WES to seek appropriate protection.
a. Consultant also acknowledges that the WES's product design and
performance information and its customer/client list maintained on the
WES's database and in the WES's files was compiled by the WES's expenditure
of a great amount of time, money and effort and that such information
contains sufficient detail that could not be created independently from
public sources. Accordingly, Consultant agrees that the WES's product
design and performance information and customer/client list constitutes a
"trade secret" and is subject to protection under the Florida Uniform Trade
Secrets Act.
b. Consultant agrees that upon termination of the engagement, whether
termination is by the WES, with or without cause, or for any other reason
whatsoever, or by the Consultant, Consultant shall return all copies, in
whatever form, including hard copies and computer disks, of WES product
design and performance information and such customer/client list to the
WES, and Consultant shall delete any copy of WES product design and
performance information and the customer/client list on any computer file
or database maintained by Consultant. Further, Consultant agrees that
unauthorized retention of any such copies shall constitute "civil theft" as
such term is defined in Chapter 772 of the Florida Statutes.
c. Consultant also agrees that Consultant shall not, at any time
following termination of engagement, whether termination is by the WES,
with or without cause, wrongful discharge, or for any other reason
whatsoever, or by the Consultant, use or disclose WES product design and
performance information or the WES's customer/client list, directly or
indirectly, for himself or herself, or on behalf of others, as an
individual on Consultant's own account, or as a partner, joint venturer,
Consultant, agent, salesman, contractor, officer, director or otherwise,
for any person, partnership, firm, corporation, or other entity.
Section 10 - Importance of Certain Clauses - Consultant and WES state that
the Restrictive Covenant and Confidentiality Agreement incorporated into this
contract are material terms of this contract and all parties understand the
importance of such provisions to the ongoing business of WES. As such, because
WES's continued business and viability depend on the protection of such secrets
and non-competition, these clauses are interpreted by the parties to have the
widest and most expansive applicability as may be allowed by law and Consultant
understands and acknowledges his or her understanding of same.
Section 11 - Consideration - Consultant acknowledges and agrees that the
engagement contemplated by this Agreement and the execution by WES of this
Agreement constitute full, adequate and sufficient consideration to Consultant
for the Consultant's duties, obligations and covenants under this Agreement.
Section 12 - Indebtedness - If, during the course of Consultant's
engagement under this Agreement, Consultant becomes indebted to WES for any
reason, WES may, if it so elects, set off any sum due to WES from Consultant and
collect from Consultant any remaining balance.
Section 13 - The Consultant Shall not Contract for WES - The Consultant
shall not have the right to make any contracts or commitments for or on behalf
of the WES without first obtaining the express consent of the WES.
Section 14 - Indemnity - Consultant shall indemnify WES and hold WES
harmless for any and all damages, liabilities, settlements, costs, judgments,
arbitration awards, administrative fines and attorneys fees arising from any
acts, omissions or decisions made by Consultant while performing services for
WES, where such acts and/or decisions are determined by arbitrators, a court or
jury to be fraudulent, negligent, and/or to constitute a breach of fiduciary
duty or in the event WES, in the exercise of its business judgment, determines
to settle any claim made by any individual against the Company regarding the
conduct of Consultant. Any amount due and owing to the Company under this
paragraph may be collected at the Company's discretion from outstanding
compensation otherwise payable to Consultant.
Section 15 - Effect of Partial Invalidity - The invalidity of any portion
of this Agreement shall not affect the validity of any other provision. In the
event that any provision of this Agreement is held to be invalid, the Parties
agree that the remaining provisions shall remain in full force and effect.
Section 16 - Entire Agreement - This Agreement reflects the complete
agreement between the Parties and shall supersede all other agreements, either
oral or written, between the Parties. The Parties stipulate that neither of
them, nor any person acting on their behalf has made any representations except
as are specifically set forth in this Agreement and each of the Parties
acknowledges that they have not relied upon any representation of any third
Party in executing this Agreement, but rather have relied exclusively on their
own judgment in entering into this Agreement.
Section 17 - Assignment - WES may sell, assign or transfer its interest and
rights under this Agreement at its sole discretion and without approval of
Consultant. All rights and entitlements arising from this Agreement, including
but not limited to those protective covenants and prohibitions set forth in
paragraph 7 herein, shall inure to the benefit of any purchaser, assignor or
transferee of this Agreement and shall continue to be enforceable to the extent
allowable under applicable law. Neither this Agreement, nor the employment
status conferred with its execution is assignable or subject to transfer in any
manner by Consultant.
Section 18 - Notices - All notices, requests, demands, and other
communications shall be in writing and shall be given by registered or certified
mail, postage prepaid, to the address shown on the first page of this Agreement,
or to such subsequent addresses as the parties shall so designate in writing.
Section 19 - Remedies - If any action at law, equity or in arbitration,
including an action for declaratory relief, is brought to enforce or interpret
the provisions of this Agreement, WES shall be entitled to recover its
reasonable attorneys' fees and costs from Consultant.
Section 20 - Amendment/Waiver - No waiver, modification, amendment or
change of any term of this Agreement shall be effective unless it is
memorialized in a writing signed by both parties. No waiver by WES of any breach
or threatened breach of this Agreement shall be construed as a waiver of any
subsequent breach.
Section 21 - Governing Law, Venue and Jurisdiction - This Agreement and all
transactions contemplated by this Agreement shall be governed by, construed, and
enforced in accordance with the Laws of the State of Florida without regard to
any conflicts of laws, statutes, rules, regulations or ordinances. Consultant
consents to personal jurisdiction and venue in the Circuit Court in and for
Pinellas County, Florida regarding any action arising under the terms of this
Agreement and any and all other disputes between with WES.
Section 22- Arbitration- Any and all controversies and disputes between
Consultant and WES arising from this Agreement or regarding any other matter
whatsoever shall be submitted to arbitration before the American Arbitration
Association, utilizing its Commercial Rules. Any arbitration action brought
pursuant to this section shall be heard in St. Petersburg, Pinellas County,
Florida. The Circuit Court in and for Pinellas County, Florida shall have
concurrent jurisdiction with any arbitration panel for the purpose of entering
temporary and permanent injunctive relief.
Section 23 - Headings - The titles to the paragraphs of this Agreement are
solely for the convenience of the parties and shall not affect in any way the
meaning or interpretation of this Agreement.
Section 24 - Term - This Agreement shall commence on the date of execution
identified below and shall remain in force and effect until March 31, 2008,
unless terminated before such time by one of the Parties hereto. In the event of
termination prior to the expiration hereunder, all compensation identified in
this Agreement shall cease to be due and owing by WES.
Section 25 - Miscellaneous Terms - The parties to this Agreement declare
and represent that:
a. They have read and understand this Agreement;
b. They have been given the opportunity to consult with an attorney if
they so desire;
c. They intend to be legally bound by the promises set forth in this
Agreement and enter into it freely, without duress or coercion;
d. They have retained signed copies of this Agreement for their
records; and
e. The rights, responsibilities and duties of the parties hereto, and
the covenants and agreements contained herein, shall continue to bind the
parties and shall continue in full force and effect until each and every
obligation of the parties under this Agreement has been performed.
IN WITNESS WHEREOF, the parties have executed this Agreement on this 31st
day of January, 2006.
WORLD ENERGY SOLUTIONS, INC.
/s/ Xxxxxxxx X. Xxxxxxx /s/ Xxxxxx X. Xxxxxx
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Xxxxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxx, Consultant
Chief Executive Officer
