EXHIBIT D
Consulting Agreement Terms and Provisions, April 21, 1997 - Xxxxxxx
Xxxxx 21, 1997
Xxxxxx Xxxxxxx
000 Xxxxxx Xxxxx
Xxxxx XXX
Xxx Xxxx, XX 00000
Dear Xx. Xxxxxxx:
This letter will service as an agreement between Industrial Services of
America, Inc. ("ISA" or the "Company") and Xxxxxx Xxxxxxx with respect to the
retention of Xxxxxx Xxxxxxx to provide financial advisory and investment
banking services on behalf of ISA in its interest in acquiring specified
companies in the United States (the "target" or the "target company").
1.0 FINANCIAL ADVISORY AND INVESTMENT BANKING SERVICES
1.1 Xxxxxx Xxxxxxx will represent the Company to each of the proposed
targets, assist in identifying potential targets, and begin a dialogue
with the intent of determining each target's interest in being acquired
by ISA or, alternatively, entering into a joint venture or other
"partnering" agreement with ISA.
1.2 Upon an indication of interest on the part of a target company, Xxxxxx
Xxxxxxx will perform preliminary due diligence and provide ISA with an
initial valuation determination. Upon an agreement in principle with a
target company, Xxxxxx Xxxxxxx will undertake with ISA a more intensive
due diligence review.
1.3 Subject to the approval of ISA, Xxxxxx Xxxxxxx will coordinate final
negotiations and transaction documentation with each target company.
Xxxxxx Xxxxxxx will assist the Company in selecting local professional
services such as legal counsel, accounting, appraisers, etc. and will
assist in coordinating certain regulatory and governmental compliance
issues.
1.4 Xxxxxx Xxxxxxx will review each transaction as to structure and
recommend to the Company any modifications which it believes may be
appropriate under the circumstances.
2.0 RETENTION OF XXXXXX XXXXXXX
2.1 ISA hereby retains Xxxxxx Xxxxxxx on a non-exclusive basis for a minimum
term of twelve (12) months from the date hereof (the "initial term") to
perform the services outlined in Section 1 hereof. Upon its execution of
this Agreement, ISA shall pay to Xxxxxx Xxxxxxx an initial retainer in
the form of an option to acquire one hundred thousand (100,000) shares
of common stock, to be registered on form S-8 on or before June 30,
1997, as promulgated by the Securities and Exchange Commission, at an
exercise price of $5.50 per share, which shall be exercisable in whole
or in part and from time to time at the sole discretion of Xxxxxx
Xxxxxxx for a period of three (3) years from the date of this Agreement.
Additionally, Xxxxxx Xxxxxxx shall be granted an option to acquire
twenty-five thousand shares, under Rule 144, or in such other form as to
make the shares Xxxxxx Xxxxxxx acquires freely tradable, from Xxxxx
Xxxxxxx individually at an exercise price of $5.50 per share, which
shall be exercisable in whole or in part and from time to time at the
sole discretion of Xxxxxx Xxxxxxx.
2.2 In addition to the payment of retainer fees, ISA shall reimburse Xxxxxx
Xxxxxxx for all reasonable, direct, out-of-pocket expense incurred on
behalf of ISA, which shall include all reasonable travel-related,
telephone and facsimile expenses, duplicating, printing, binding and
courier expenses and fees of legal counsel provided, however, that the
engagement of any such counsel shall have been pre-approved by ISA.
Further, any item of expense exceeding two hundred and fifty dollars
(USD $250) shall be pre-approved by ISA prior to occurrence.
3.0 ANNOUNCEMENT BY XXXXXX XXXXXXX
3.1 If any transaction contemplated by this Agreement is completed, Xxxxxx
Xxxxxxx may at his option and expense, place a conventional announcement
in newspapers and periodicals of its choice stating that Xxxxxx Xxxxxxx
has acted as financial advisor to ISA given, however, that ISA has the
right to approve any announcement prior to publication.
4.0 NO AGENCY
4.1 Xxxxxx Xxxxxxx understands and acknowledges that this letter shall not
create or imply any agency agreement between the parties. Xxxxxx Xxxxxxx
shall not have the right to commit ISA, its officers, directors or
shareholders in any manner except as shall have been specifically
authorized in writing by ISA.
5.0 INDEMNIFICATION
5.1 In connection with the services which Xxxxxx Xxxxxxx has agreed to
render to ISA herein, the Company shall indemnify Xxxxxx Xxxxxxx, him
harmless against any losses, claims, damages or liabilities to which
Xxxxxx Xxxxxxx may become subject in connection with his rendering of
such services except for such loses, claims, damages or liabilities
resulting from or arising out of the gross negligence or willful
misconduct of Xxxxxx Xxxxxxx. Xxxxxx Xxxxxxx will promptly notify SIA
upon receipt of any notices of claim or any threat to institute an
action or proceeding for which he or any other person claims entitlement
to indemnification pursuant to this provision and will promptly notify
ISA after any such proceeding is commenced. In the event Xxxxxx Xxxxxxx
becomes involved in any action or proceeding for which it is indemnified
hereunder, the Company shall reimburse Xxxxxx Xxxxxxx for any reasonable
legal or other expenses reasonably incurred by it in connection with
investigating, preparing to defend or defending any lawsuits or other
proceedings arising in any manner out of or in connection with the
rendering of such services. ISA agrees that the indemnification and
reimbursement commitment set forth in this Agreement shall apply whether
or not Xxxxxx Xxxxxxx is a formal party to any such lawsuits or other
proceedings, provided that Xxxxxx Xxxxxxx has a reasonable basis to
believe that it is likely to be named in a formal action. Xxxxxx Xxxxxxx
shall be entitled to retain separate counsel of his choice in connection
with any of the matters to which such commitments relate and that such
commitments shall extend upon the terms set forth in this Agreement to
any controlling person, director, officer, employee or other agent of
Xxxxxx Xxxxxxx.
5.2 In connection with the services which Xxxxxx Xxxxxxx has agreed to
render to ISA herein, Xxxxxx Xxxxxxx shall indemnify ISA, its officers,
directors, agents, and hold it harmless against any losses, claims,
damages or liabilities to which ISA may become subject in connection
with Xxxxxx Xxxxxxx'x rendering of such services except for such losses,
claims, damages or liabilities resulting from or out of the gross
negligence or willful misconduct of ISA. ISA will promptly notify Xxxxxx
Xxxxxxx upon receipt of any notices of claim or any threat to institute
an action or proceeding for which he or any other person claims
entitlement to indemnification pursuant to this provision and will
promptly notify Xxxxxx Xxxxxxx after any such proceeding is commenced.
In the event ISA becomes involved in any action or proceeding for which
he is indemnified hereunder, Xxxxxx Xxxxxxx shall reimburse ISA for any
reasonable legal or other expenses reasonably incurred by it in
connection with investigating, preparing to defend or defending any
lawsuits or other proceedings arising in any manner out of or in
connection with rendering
of such services. Xxxxxx Xxxxxxx agrees that the indemnification and
reimbursement commitment set forth in this Agreement shall apply whether
or not ISA is a formal party to any such lawsuits or other proceedings,
provided that ISA has a reasonable basis to believe that it is likely to
be named in formal action. ISA shall be entitled to retain separate
counsel of its choice in connection with any of the matters to which
such commitments relate and that such commitments shall extend upon the
terms set forth in this Agreement to any controlling person, director,
officer, employee or other agent of ISA.
5.3 The indemnity agreement contained in this Section 5.0 and the
representations and warranties of ISA and Xxxxxx Xxxxxxx contained in
this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any
investigation made by Xxxxxx Xxxxxxx or on behalf of Xxxxxx Xxxxxxx or
on behalf of ISA, its officers or directors or any other person
controlling the Company or (iii) consummation of the transaction(s)
contemplated by this Agreement.
6.0 MODIFICATION/SEVERABILITY
6.1 The Agreement represents the entire agreement between the parties which
may not be amended or modified except in writing, and shall be binding
upon and inure to the benefit of the parties and their successors and
assigns. If any provision of this Agreement, or part thereof, shall be
held to be invalid or unenforceable, it shall not affect the validity or
enforceability of the remaining part or any other provision of this
Agreement.
7.0 HEADINGS
7.1 Headings are for the convenience only and shall not affect the
interpretation or meaning of the context thereunder.
8.0 REPRESENTATIONS AND WARRANTIES
8.1 By execution of this Agreement, each of the parties hereto represents
and warrants the other party hereto, and each of the parties hereto
shall be entitled to rely fully upon such representations, that (i) it
has full and complete corporate authority to enter into this Agreement,
(ii) that the officer executing on behalf of such party is duly
empowered to so execute and, as of the date of this signing, holds in
good standing the office indicated and (iii) that such party intends to
be legally bound by the terms set forth herein which shall be governed
and interpreted under the laws of the State of Illinois. Moreover,
Xxxxxx Xxxxxxx represents and warrants to ISA that it will materially
comply with all applicable securities laws; provided, however, that ISA
acknowledges that Xxxxxx Xxxxxxx is a private advisory firm and not a
broker-dealer for purposes of such laws.
Industrial Services of America, Inc.
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Xxxxx Xxxxxxx
ACCEPTED AND AGREED TO:
By: ____________________
Xxxxxx Xxxxxxx
