CONSULTING AGREEMENT
Exhibit
10.7
This
Consulting Agreement (“Agreement”)
is
made effective as of August 1, 2005, by and between SonomaWest Holdings,
Inc. of
0000 Xxxxxxx 000 Xxxxx, Xxxxxxxxxx, XX 00000-0000, and Xxxxxx X. Xxxxx d.b.a.
Xxxxx Consulting, of 0000 Xxxxxx Xxxxx X, Xxxxx Xxxx, Xxxxxxxxxx
00000.
In
this
Agreement, the party who is contracting to receive services shall be referred
to
as "SWH",
and the
party who will be providing the services shall be referred to as "Xxxxx".
Xxxxx
has a background in Financial Management and is willing to provide consulting
services to SWH based on this background.
SWH
desires to have services provided by Xxxxx.
Now
therefore, the parties agree as follows:
1.
DESCRIPTION OF SERVICES.
Beginning on August 1, 2005, Xxxxx will provide consulting services
(collectively, the "Services")
in the
area of financial management and related management matters, specifically
Xxxxx
will perform the duties generally undertaken by a chief financial officer
or
treasurer of a corporation; provided however, that Xxxxx shall report directly
to the Chief Executive Officer of the Company (“CEO”)
of SWH.
Xxxxx shall serve as Chief Financial Officer until the earlier to occur of
his
termination or resignation. Xxxxx shall have the authority and responsibility
to
act for or on behalf of the corporation, which is usually held by a person
holding the office of Chief Financial Officer. Should Xxxxx reasonably determine
that any project or projects Xxxxx is requested to work on fall outside the
scope of the duties generally undertaken by a chief financial officer of
a
corporation, Xxxxx shall notify the CEO of such determination and Xxxxx may
reject that project or projects without breaching this Agreement. The CEO
and
Xxxxx shall use their respective commercially reasonable best efforts to
resolve
any disagreement with respect to whether or not the specific project or projects
fall within the scope of the services to be performed by Xxxxx.
2.
PERFORMANCE OF SERVICES.
The
manner in which the Services are to be performed and the specific hours to
be
worked by Xxxxx shall be determined by Xxxxx. SWH will rely on Xxxxx to work
as
many hours as may be reasonably necessary to fulfill Xxxxx'x obligations
under
this Agreement.
3.
PAYMENT.
SWH will
pay a fee to Xxxxx for the Services as set forth in Schedule A, which is
attached hereto and incorporated herein by this reference. SWH will reimburse
Xxxxx for any out of pocket expenses incurred in the provision of Services
hereunder. Xxxxx will invoice SWH approximately every two weeks for consulting
and expenses performed and/or incurred in the fourteen (14) day period prior
to
or through the date of invoice, or for such longer period as may have passed
since the date of the last invoice. Each invoice shall be due upon receipt:
provided however, that payment shall be considered timely if paid within
five
(5) days of the date of invoice.
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4.
SUPPORT SERVICES.
SWH will
provide sufficient office space at its executive offices in 0000 Xxxxxxx
000
Xxxxx, Xxxxxxxxxx, XX (or at such future Sonoma County, California executive
offices as SWH may occupy) for use by Xxxxx in performing the Services
hereunder. SWH shall direct its employees to cooperate with and render
assistance to Xxxxx in furtherance of the completion of the
Services.
5.
TERM/TERMINATION.
This
Agreement shall continue in effect until July 31, 2006, unless terminated
sooner
pursuant to the following provision of this Paragraph 5. This Agreement may
be
terminated by either party, for any reason or no reason, upon prior written
notice to the other party. A termination of this Agreement shall automatically
terminate Xxxxx as Chief Financial Officer of SWH. Upon termination, Xxxxx
shall
not be entitled to any severance or similar compensation payments.
6.
RELATIONSHIP OF PARTIES.
It is
understood by the parties that Xxxxx is an independent contractor with respect
to SWH, and not an employee of SWH. SWH will not provide fringe benefits,
including health insurance benefits, paid vacation, or any other employee
benefit, for the benefit of Xxxxx; provided however that Xxxxx shall be entitled
to receive such grants of options as the Board of Directors may from time
to
time determine. Notwithstanding the foregoing, SWH agrees to provide Xxxxx
with
a certified copy of the minutes of the Board of Directors meeting at which
Xxxxx
is elected Chief Financial Officer and of any subsequent meeting in which
he is
again so elected. In addition, as material consideration to Xxxxx for his
performance of the Services hereunder SWH agrees that at all times during
the
term of this Agreement, SWH will have and maintain a policy of Directors
&
Officers insurance which provides coverage for Xxxxx in an amount reasonably
satisfactory to Xxxxx. Upon request SWH shall provide Xxxxx with proof of
such
coverage.
7.
LIMITATION OF LIABILITY AND INDEMNIFICATION.
Xxxxx
will not be liable to SWH, or to anyone who may claim any right due to a
relationship with SWH, for any injuries due to any act(s) or omission(s)
arising
from or related to this Agreement and/or the performance of the Services
hereunder or on the part of the employees or agents of Xxxxx unless the act(s)
and/or omission(s) are due to Xxxxx’x gross negligence or willful misconduct.
SWH will indemnify and hold Xxxxx harmless from any obligations, costs, claims,
judgments, attorneys’ fees, and attachments arising from, growing out of, or in
any way connected with the Services rendered to SWH under the terms of this
Agreement, other than due to Xxxxx’x gross negligence or willful
misconduct.
8.
INDEMNIFICATION.
Xxxxx
agrees to indemnify, defend and hold SWH free and harmless from any obligations,
costs, claims, judgments, attorneys’ fees, and attachments arising from, growing
out of, or in any way connected with the Services rendered to SWH the terms
of
this Agreement, in any and all cases due to Xxxxx’x gross negligence or willful
misconduct.
9.
ASSIGNMENT.
Xxxxx'x
obligations under this Agreement may not be assigned or transferred to any
other
person, firm, or corporation without the prior written consent of SWH. SWH
obligations under this Agreement may not be assigned or transferred to any
other
person, firm, or corporation without the prior written consent of Xxxxx;
provided, however, that no prior consent shall be required in connection
with
assignment of the Agreement in connection with a merger or sale of the business
of SWH.
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10.
CONFIDENTIALITY.
SWH
recognizes that Xxxxx will have the following information: future plans,
business affairs, financial data and projections and other proprietary
information (collectively, "Information") which are valuable, special and
unique
assets of SWH and need to be protected from improper disclosure. In
consideration for the disclosure of the Information, Xxxxx agrees that Xxxxx
will not at any time or in any manner, either directly or indirectly, use
any
Information for Xxxxx'x own benefit, or divulge, disclose, or communicate
in any
manner any Information to any third party without the prior written consent
of
SWH. The confidentiality and limited use obligations set forth above shall
not
apply to information, which Xxxxx can demonstrate:
(a) Was
already in Xxxxx’x possession prior to receipt of the same from the SWH without
an obligation to maintain its confidentiality; or
(b) Is
now or
becomes public information or otherwise generally known to the public without
violation of this Agreement; or
(c) Was
received by Xxxxx without restriction from a third party which was lawfully
in
possession of such information and was not in breach of any agreement or
any
confidential relationship with SWH.
Disclosure
of SWH Information is not prohibited if such disclosure is compelled pursuant
to
legal proceeding or otherwise required by law and prior written notice is
given
to SWH. Xxxxx
will protect the Information and treat it as strictly confidential. A violation
of this paragraph shall be a material breach of this Agreement.
11.
WORK
FOR HIRE.
Xxxxx
agrees that all work he performs pursuant to this Agreement, and all work
which
relates at the time of conception or reduction to Company's business, and
all
work which results from work he performs for Company, whenever performed
during
the term of this Agreement, and whether or not utilizing Company's equipment,
supplies, facilities, Information or other trade secret information, is
considered work made for hire for Company as such term is defined in section
101
of the Copyright Act of 1976 and belongs to Company. Xxxxx further agrees
that
in the event that this Agreement is determined not to be a work for hire
agreement, Xxxxx will assign to Company any and all rights retained by
Xxxxx.
12.
UNAUTHORIZED DISCLOSURE OF INFORMATION.
If it
appears that Xxxxx has disclosed (or has threatened to disclose) Information
in
violation of this Agreement, SWH shall be entitled to an injunction to restrain
Xxxxx from disclosing, in whole or in part, such Information, or from providing
any services to any party to whom such Information has been disclosed or
may be
disclosed. SWH shall not be prohibited by this provision from pursuing other
remedies, including a claim for losses and damages except as is otherwise
provided in this Agreement.
-3-
13.
CONFIDENTIALITY AFTER TERMINATION.
The
confidentiality provisions of this Agreement shall remain in full force and
effect after the termination of this Agreement for a period of five (5) years
from the date of such termination.
14.
RETURN OF RECORDS.
Upon
termination of this Agreement, Xxxxx shall deliver all records, notes, data,
memoranda, models, and equipment of any nature that are in Xxxxx'x possession
or
under Xxxxx'x control and that are SWH property or relate to SWH business.
15.
NOTICES.
All
notices required or permitted under this Agreement shall be in writing and
shall
be deemed delivered when delivered in person or deposited in the United States
mail, postage prepaid, addressed as follows:
| If for SWH : | Xxxxxx Xxxxxxxxx | |
| Chief Executive Officer | ||
| SonomaWest Holdings, Inc. | ||
| 0000 Xxxxxxx 000, Xxxxx | ||
| Xxxxxxxxxx, XX 00000-0000 | ||
| If for Xxxxx: | Xxxxxx X. Xxxxx | |
| Xxxxx Consulting | ||
| PO Box 2725 | ||
| 0000 Xxxxxx Xxxxx, X | ||
| Xxxxx Xxxx, Xxxxxxxxxx 00000-0000 | ||
16.
ENTIRE AGREEMENT.
This
Agreement contains the entire agreement of the parties and there are no other
promises or conditions in any other agreement whether oral or written. This
Agreement supersedes any prior written or oral agreements between the
parties.
17.
AMENDMENT.
This
Agreement may be modified or amended only by an amendment in writing signed
by
both parties.
18.
SEVERABILITY.
If any
provision of this Agreement shall be held to be invalid or unenforceable
for any
reason, the remaining provisions shall continue to be valid and enforceable.
If
a court finds that any provision of this Agreement is invalid or unenforceable,
but that by limiting such provision it would become valid and enforceable,
then
such provision shall be deemed to be written, construed, and enforced as
so
limited.
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19.
WAIVER.
The
failure of either party to enforce any provision of this Agreement shall
not be
construed as a waiver or limitation of that party's right to subsequently
enforce and compel strict compliance with every provision of this
Agreement.
20.
APPLICABLE LAW.
This
Agreement shall be governed by the laws of the State of California.
21.
ATTORNEYS’ FEES.
If any
legal action is brought to enforce or interpret the provisions of this
Agreement, the prevailing party will be entitled to reasonable attorneys’ fees,
in addition to any other relief to which that party may be
entitled.
| “SWH”: | |||
| SonomaWest Holdings, Inc. | |||
| By: /s/ Xxxxxx Xxxxxxxxx | |||
|
Xxxxxx Xxxxxxxxx, Chief Executive Officer |
|||
| “Xxxxx” | |||
| Xxxxxx X. Xxxxx, d.b.a. Xxxxx Consulting | |||
| By: /s/ Xxxxxx X. Xxxxx | |||
|
Xxxxxx X. Xxxxx |
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Schedule
A to Consulting Agreement dated as of August 1, 2005
XXXXX
CONSULTING
FINANCIAL &
MANAGEMENT
CONSULTING
X.X.
XXX 0000
XXXXX XXXX,
XX 00000-0000
PHONE AND FAX: (000)
000-0000
CELL:
(000)
000-0000
E-MAIL:
xxx@xxxxxxxxxxxxxxx.xxx
CONSULTING
FEE SCHEDULE
August
1,
2005
HOURLY
FEES
| § |
Financial
or management consulting $115.00/hour.
|
| § |
Use
of outside consultants billed at cost plus 10%, provided that any
use of
an outside consultant must first be approved by
SWH.
|
| § |
Legal
proceedings (testimony in deposition, trials and arbitration/mediation
hearings) are billable at 1.5 times the standard rate per
hour.
|
TRAVEL
| § |
Travel
inside Sonoma County -
Non-chargeable.
|
| § |
Travel
outside Sonoma County - Travel time billed at regular hourly consulting
rate.
|
| § |
Over-night
travel - Daily rate to be mutually agreed upon in
advance.
|
| § |
Mileage
outside Sonoma County is billed at the mileage rate established
by the
Internal Revenue Service.
|
| § |
Out
of pocket expenses billed at cost.
|
XXXXXXXX
| § |
Invoices
will be issued every two weeks.
|
| § |
Minimum
billing of four hours for all required on-site visits or meetings
outside
Sonoma County.
|
| § |
Terms
- Net five days from receipt.
|
