EXHIBIT 10.19
AGREEMENT FOR CONSULTING SERVICES
THIS AGREEMENT FOR CONSULTING SERVICES is entered into this November ___,
1996, by and between GORGES/QUIK-TO-FIX FOODS, INC., a Delaware corporation (the
"Corporation"), and CGW SOUTHEAST III, L.L.C., a Delaware limited liability
company ("CGW").
BACKGROUND
A. The Corporation desires to engage CGW for the purpose of providing
financial and management consulting services to the Corporation.
B. CGW is willing to accept such engagement upon the terms and conditions
set forth herein.
AGREEMENT
For and in consideration of the above premises and the mutual covenants and
agreements hereinafter set forth, and other good and valuable consideration, the
receipt and sufficiency of which are acknowledged, the parties hereto agree as
follows:
1. SCOPE OF CONSULTING SERVICES. The Corporation retains CGW, and CGW
accepts engagement by the Corporation, to provide financial advisory and
management consulting services to the Corporation and its subsidiaries. In such
capacity, CGW will assist the Corporation and its subsidiaries in financial and
strategic planning and analysis. Such consulting services shall include having
a representative of CGW in attendance at all meetings of the Board of Directors
of the Corporation, evaluation of and negotiations with potential candidates for
acquisition by the Corporation, assisting the Corporation in relations with its
lenders, and providing advice to the Corporation on its capital needs and
structure, including general advice and assistance regarding refinancings or
public offerings or sale of the Corporation. CGW agrees to be available to the
Corporation as needed and to cause such services to be provided by persons
employed or retained by or affiliated with CGW or its general partner. Unless
required by reason of the nature of the particular consulting service, such
services may be performed at the offices of CGW.
2. TERM. The term (the "Term") of this Agreement shall commence on the
date hereof and end on the fifth anniversary of the date hereof. This Agreement
may be terminated prior to the expiration of the Term only (i) by mutual
agreement of CGW and the Corporation, (ii) as provided in Section 5 below, or
(iii) by the Corporation upon the willful failure of CGW to provide consulting
services hereunder if such failure is not remedied within thirty (30) days after
receipt by CGW of written notice by the Corporation to CGW. Upon any
termination of this Agreement for any reason other than as provided in Section 5
below, CGW's right to receive compensation pursuant to Section 3 hereof shall
cease and terminate.
3. COMPENSATION.
(a) For the services rendered by CGW hereunder, the Corporation shall
pay to CGW (i) a monthly fee of $30,000 on the first day of each calendar month
occurring during the Term, (ii) a fee with respect to each fiscal year of the
Corporation that ends during the Term in an amount equal to the bonus paid to
the Chief Executive Officer of the Corporation with respect to such fiscal year,
such additional fee to be paid at the same time as such bonus is paid to the
Chief Executive Officer, and (iii) a fee with respect to the portion of the
fiscal year of the Corporation in which this Agreement begins or ends and during
which this Agreement is in effect in an amount equal to the portion of the bonus
paid to the chief executive officer of the Corporation with respect to such
fiscal year pro rated based upon the number of days during such fiscal year this
Agreement is in effect. The amount payable under this Section 3(a) is herein
referred to as the "Retainer Fee." Notwithstanding the foregoing, in no event
shall the Retainer Fee exceed $500,000 in any fiscal year that ends during the
term.
(b) In addition to the Retainer Fee, the Corporation shall pay to CGW
fees in such amounts as shall be mutually agreed upon in advance for any
services provided by CGW with respect to services provided to the Corporation by
CGW at the request of the Corporation or any of its subsidiaries which fall
outside the scope of services generally contemplated by Section 1 of this
Agreement.
(c) Upon termination of this Agreement as provided in Section 5 below,
the Corporation shall pay to CGW an amount equal to the aggregate Retainer Fee
that would have been paid over the remaining Term had such termination not
occurred. For purposes of determining such amount the bonus deemed to be paid
to the Chief Executive Officer of the Corporation for any fiscal year of the
Corporation ending after any such termination shall be the average of the
annual bonus paid to such officer for the full fiscal years of the Corporation
ended after the date hereof and prior to such termination, and if no full fiscal
years have ended during such period, then the bonus deemed to be paid to the
chief executive officer for each fiscal year of the Corporation ending after
such termination of this Agreement shall be $140,000.
4. EXPENSES. The Corporation shall reimburse CGW for all of CGW's costs
and expenses (other than ordinary overhead) reasonably incurred in connection
with (i) attendance at meetings with the Corporation or any subsidiary, and (ii)
provision of its services hereunder. Such reimbursements shall be paid to CGW
in a timely manner in accordance with the regular expense reimbursement policy
of the Corporation and upon submission by CGW of all documentation ordinarily
required by the Corporation's policy on reimbursement of expenses.
5. CHANGE OF CONTROL. This Agreement shall terminate upon the occurrence
of a Change in Control with respect to the Corporation. As used herein, a
"Change in Control" shall be deemed to have occurred with respect to the
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Corporation upon (i) the consummation of any merger, share exchange or
consolidation (other than with an affiliate of the Corporation) of the
Corporation in which the shareholders of the Corporation immediately prior to
such merger, share exchange or consolidation shall not following such merger,
share exchange or consolidation, own, directly or indirectly, at least fifty
percent (50%) of the aggregate voting power of the outstanding securities of
the continuing or surviving entity, (ii) any issuance or sale by the Corporation
in a single transaction or series of related transactions of shares of the
Corporation's capital stock which constitute after such issuance and sale fifty
percent (50%) or more of the aggregate voting power of the outstanding
securities of the Corporation, other than the issuance and sale of capital stock
in a public offering of such securities or in connection with the exercise of
options to purchase such voting securities granted to its employees or lenders,
(iii) any other transaction or series of transactions in which the current
holders of the Corporation's common stock cease to own, directly or indirectly,
fifty percent (50%) or more of the aggregate voting power of the outstanding
securities of the Corporation, other than through a public offering of the
voting securities of the Corporation or other than in connection with the
exercise of options to purchase voting securities of the Corporation granted to
employees or lenders of the Corporation, or (iv) any sale in a single
transaction or a series of related transactions of all or substantially all of
the assets of the Corporation. The Corporation agrees to notify CGW promptly of
any Change in Control of the Corporation by mailing to CGW written notice of
such Change in Control, it being the intent of this provision that CGW be
informed at all times concerning the ownership of the Corporation.
6. ENTIRE AGREEMENT. This Agreement embodies the entire agreement of the
parties hereto with respect to the services to be provided by CGW hereunder. No
amendment or modification of this Agreement shall be valid or binding upon the
Corporation or CGW unless made in writing and signed by the parties hereto.
7. INDEPENDENT CONTRACTOR. CGW is and shall be an independent
contractor, and no employment relationship between the Corporation and CGW is
intended to be created hereby.
8. INDEMNIFICATION.
(a) The Corporation shall indemnify and hold harmless CGW and its
affiliates, their respective officers, directors, controlling persons
(within the meaning of Section 15 of the Securities Act of 1933 or
Section 20(a) of the Securities Exchange Act of 1934), if any,
employees and agents of CGW or any of CGW's affiliates (each such
person being an "Indemnified Person") from and against any losses,
claims, damages or liabilities related to, arising out of or in
connection with CGW's engagement hereunder.
(b) The Corporation shall reimburse each Indemnified Person for all
reasonable expenses (including fees and expenses of counsel) as they
are incurred in connection with investigating, preparing, pursuing or
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defending any action, claim, suit, investigation or proceeding related
to, arising out of or in connection with CGW's engagement hereunder,
whether or not pending or threatened and whether or not any
Indemnified Person is a party; provided however, that if a final
judicial determination is made that any losses, claims, damages or
liabilities (or expenses related thereto) have resulted from the bad
faith or gross negligence of any Indemnified Person, then each
Indemnified Person will remit to the Corporation any amounts
reimbursed under this subparagraph 8(b).
(c) The Corporation will not be responsible for any losses, claims,
damages or liabilities (or expenses related thereto) that are finally
judicially determined to have resulted from the bad faith or gross
negligence of any Indemnified Person. The Corporation further agrees
that no Indemnified Person shall have any liability (whether direct or
indirect, in contract or tort or otherwise) to the Corporation or to
any person claiming through the Corporation (including, without
limitation, equity holders and creditors of the Corporation) for or in
connection with CGW's engagement hereunder except for any such
liability for losses, claims, damages or liabilities incurred by the
Corporation that are finally judicially determined to have resulted
from the bad faith or gross negligence of such Indemnified Person. If
multiple claims are brought against CGW in an arbitration, with
respect to at least one of which indemnification is permitted under
applicable law and provided for under this Agreement, the Corporation
agrees that any arbitration award shall be conclusively deemed to be
based on claims as to which indemnification is permitted and provided
for, except to the extent the arbitration award expressly states that
the award, or any portion thereof, is based solely on a claim as to
which indemnification is not available.
(d) The Corporation agrees that each Indemnified Person is entitled to
retain separate counsel of its choice in connection with any of the
matters to which the indemnification and reimbursement commitments set
forth in subparagraphs 8(a) and 8(b) above relate.
(e) No Indemnified Person seeking indemnification, reimbursement or
contribution under this Agreement will, without the Corporation's
prior written consent, settle, compromise, consent to the entry of any
judgment in or otherwise seek to terminate any action, claim, suit,
investigation or proceeding referred to in this subparagraph 8(a)
above.
(f) The foregoing rights to indemnity and contribution shall be in
addition to any rights that CGW and/or any other Indemnified Person
may have at common law or otherwise and shall remain in full force and
effect following the completion or any termination of CGW's
engagement. The Corporation hereby consents to personal jurisdiction
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and to service and venue in any court in which any claim which is
subject to this Agreement is brought against CGW or any other
Indemnified Person.
(g) The Corporation and CGW agree that if any indemnification or
reimbursement sought pursuant to this Section 8 is finally judicially
determined to be unavailable (except by reason of the gross negligence
or bad faith of any Indemnified Person), then, whether or not CGW is
the person entitled to indemnification or reimbursement, the
Corporation and CGW shall contribute to the losses, claims, damages,
liabilities and expenses for which such indemnification or
reimbursement is held unavailable in such proportion as is appropriate
to reflect the relative benefits to the Corporation on the one hand,
and CGW on the other, in connection with the transaction to which such
indemnification or reimbursement relates, and other equitable
considerations; provided however, that in no event shall the amount to
be contributed by CGW exceed the amount of the fee actually received
by CGW hereunder.
9. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia.
10. DELEGATION. CGW hereby delegates to CGW Southeast Management III,
L.L.C. ("Management") the performance of all duties of CGW hereunder, and
directs the Corporation to make payment of the Retainer Fee and all other
amounts due CGW hereunder to Management. The Corporation hereby consents to the
delegation of the performance of CGW's duties hereunder to Management, and
agrees to make payment of the Retainer Fee and such other amounts as so
directed. CGW may terminate the delegation of its duties hereunder to
Management by a written notice to the Corporation which shall be effective upon
receipt by the Corporation. From and after the receipt of such written notice,
all amounts payable hereunder to CGW shall be paid to CGW rather than to
Management. Management agrees to accept the delegation of the duties hereunder
from CGW until such delegation is terminated by CGW, and agrees to provide the
consulting services herein described in accordance with the terms hereof.
[Signatures on Next Page]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first above written.
GORGES/QUIK-TO-FIX FOODS, INC.
By: /s/ Xxxxx X. X'Xxxxxxx
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Name: Xxxxx X. X'Xxxxxxx
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Title: President
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CGW SOUTHEAST III, L.L.C.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------
Managing Director
CGW SOUTHEAST MANAGEMENT III, L.L.C.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxx
-----------------------------
Managing Director
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