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EXHIBIT 10(n)
September 16, 1996
Mr. P. Xxxxxxx Xxxxxxxx
0000 Xxxx Xxxxx Xxxxx
Xxxxx, Xxxxx 00000
Re: IPO Consulting Services Agreement
Dear Xx. Xxxxxxxx:
ErgoBilt, Inc., a Texas corporation ("Company"), intends to acquire by
merger the business of BodyBilt Seating, Inc. ("BodyBilt"), and to thereafter
operate BodyBilt as a wholly-owned subsidiary. In connection with such
acquisition, the Company desires to conduct an initial public offering of its
common stock (the "IPO"). The Company desires to retain you as a consultant to
the Company with respect to the IPO. You have agreed to provide such
consulting services on the terms and conditions set forth in this letter
agreement ("Letter Agreement").
1. GENERAL SCOPE OF SERVICES. Effective as of September 16, 1996,
the Company shall retain you as a consultant for the purposes of providing
advice and expertise on issues which directly or indirectly relate to the IPO,
including, but without limitation, all matters concerning the prospective
financial operations of the Company and its subsidiaries. You will be required
to render such services on an as-needed basis and to devote such time necessary
and/or desirable to perform your duties and responsibilities as directed by the
undersigned. The term of this Letter Agreement shall be for a period
commencing as of September 16, 1996, and shall continue until the earlier of
the Closing of the IPO or December 31, 1996. This Letter Agreement may be
extended upon the mutual agreement of the parties. In the event the IPO
closes, the Company has agreed to employ you on the terms and conditions set
forth in the form of Executive Employment Agreement attached hereto as Exhibit
A, and you have agreed to accept such employment. Such employment shall
commence on the date of the Closing of the IPO, which date shall be deemed the
"Effective Date" for said Executive Employment Agreement.
2. COMPENSATION.
2.1 CONSULTING FEE. The Company agrees to pay to you the
monthly sum of Seven Thousand and No/100 Dollars ($7,000.00) as consulting fees
( "Consulting Fees"). Consulting Fees shall be payable on the last day of each
calendar month and shall be prorated on the basis of a thirty (30) day month
for services rendered during any partial month.
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Mr. P. Xxxxxxx Xxxxxxxx
September 16, 1996
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2.2 BUSINESS EXPENSES. In addition to Consulting Fees, you
will be entitled to reimbursement on a monthly basis for reasonable, documented
business expenses incurred with respect to your services rendered. Such
business expenses shall be paid with ten (10) business days following your
submission of a written expense report. On the date of the Closing of the IPO,
you will be required to provide to the Company a full and final accounting of
all business expenses incurred.
3. TERMINATION OF LETTER AGREEMENT. Our respective obligations
under this Letter Agreement shall terminate in the event of your death or
inability to provide services due to mental or physical disability. Upon such
termination, the Company shall have no further obligation to you except for
accrued and unpaid Consulting Fees through the date of termination and business
expenses at the time of termination. This Letter Agreement shall also
terminate upon our mutual agreement that efforts to continue the conduct of
and/or otherwise close the IPO are not commercially reasonable and that your
services are no longer reasonably required. In such case, you shall receive
your Consulting Fees prorated through the effective date of such termination
plus your business expenses incurred through the termination date.
4. NON-DISCLOSURE.
(i) Confidential Information. You have agreed that you shall
not, directly or indirectly, for yourself or on behalf of any other
person, firm, partnership, organization, corporation, or any other
entity or association, reveal to any person, entity or association any
information about the Company which the Company, BodyBilt or the
Company's subsidiaries (collectively, the "ErgoBilt Companies") treats
as confidential or as trade secrets ("Confidential Information"),
neither of which are generally known in the business communities in
which the ErgoBilt Companies operate, or known to their customers,
suppliers, employees, officers, directors, shareholders or sales force.
For purposes of this Letter Agreement, the term "Confidential
Information" shall mean trade secrets, product and other research and
development activities, inventions, and any other knowledge, data or
information that the ErgoBilt Companies treat as proprietary, whether or
not such Confidential Information is patentable or copyrightable,
however it is embodied and irrespective of whether it is labeled as
"proprietary" or "confidential" and whether or not it was developed by
you. By way of illustration but not limitation, Confidential
Information includes (a) know-how, ideas, improvements, discoveries,
developments, processes, existing and future product design and
performance specifications, techniques, formulas, algorithms, product
architectures, source and object codes, data, data compilations and
other works of authorship; and (b) information regarding the ErgoBilt
Companies' marketing, sales, research and development and new product
plans, ErgoBilt Companies' business plans, budgets, and unpublished
financial statements, ErgoBilt Companies' licenses, suppliers and
customers,
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Mr. P. Xxxxxxx Xxxxxxxx
September 16, 1996
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and information regarding the skills and compensation of ErgoBilt
Companies' officers and employees. Confidential Information shall also
include any and all matters relating to the IPO, the merger with
BodyBilt, and the Company's agreements with its underwriters, bridge
lenders, or other third parties.
(ii) Non-Disclosure Agreement. You shall have no right
whatsoever to use, exploit, or disclose the Confidential Information for
any purpose other than in the performance of your obligations hereunder,
or to disclose it to any employee or other representative of the
ErgoBilt Companies other than on a "need to know" basis, or to disclose
it to any third party without the written consent of the ErgoBilt
Companies, which consent may be withheld in the ErgoBilt Companies' sole
discretion and which consent, when given, may require the third party to
execute a Non-Disclosure Agreement in a form satisfactory to the
Company.
(iii) Protection Policies and Procedures. You shall strictly
comply with any and all policies and procedures adopted by the ErgoBilt
Companies so as to protect the Confidential Information. Such policies
and procedures may include, without limitation: marking all written
materials "Confidential Information of (Name of Specific ErgoBilt
Company)" and/or with such other legends necessary or appropriate to
identify the materials as the ErgoBilt Companies' Confidential
Information; limiting access to and/or dissemination of the Confidential
Information to those persons who have a "need to know" the Confidential
Information to enable such persons to perform their duties consistent
with the purposes for which such Confidential Information was disclosed;
limiting and otherwise controlling copies or other forms of reproduction
of the Confidential Information; and maintaining the Confidential
Information in a secure place or places so as to preclude unauthorized
access thereto. If you are in doubt as to whether certain information
constitutes Confidential Information, you should assume such information
is Confidential Information subject to protection under this Letter
Agreement and treat such information accordingly.
(iv) Grounds of Dismissal. You acknowledge and agree that your
breach of your obligations under the terms of this Letter Agreement
shall constitute grounds for immediate termination.
(v) Non-Competition. You expressly agree that, any time
during or after the termination of this Letter Agreement, you will not
use any of the Confidential Information to compete, in any way, with the
ErgoBilt Companies without the prior written consent of the Company,
which consent may be withheld in its sole and absolute discretion.
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Mr. P. Xxxxxxx Xxxxxxxx
September 16, 1996
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(vi) Injunctive Relief. You understand and agree that the
ErgoBilt Companies have a substantial ongoing investment in the
development of the Confidential Information, and the ErgoBilt Companies
would be irreparably injured if this Letter Agreement were to be
breached. Should the ErgoBilt Companies, or any one of them, bring suit
for breach of this Letter Agreement or for unauthorized use or
disclosure of any Confidential Information, you consent to jurisdiction
and venue in any federal or state court in Texas, in Dallas County, and
agree that preliminary and permanent injunctive relief would be an
appropriate, though not exclusive, remedy and agree not to oppose any
request for expedited discovery in such an action.
(vii) Return of Written Materials. Immediately upon the
termination of this Letter Agreement and provided that you do not become
an employee of the Company for any reason, you shall return to the
Company the original and all copies of any written Confidential
Information.
5. INDEPENDENT CONTRACTOR. It is expressly understood that you are
acting as an independent contractor and are not subject to the Company's
control nor authorized to act as the Company's agent or legal representative.
This Letter Agreement shall not act or be construed to create an
employer-employee relationship, partnership, joint venture or any other agency
relationship between the parties. Absent the Company's prior approval, you
shall have no authority or power to make any commitments of any nature
whatsoever for the account of or on behalf of the Company. You shall have the
right to employ such personnel as you deem necessary to render services
hereunder; however, such personnel shall be at your sole cost, risk and
responsibility. You shall be responsible for all social security, income tax
withholding, unemployment insurance, and such other amounts the Company would
otherwise be required to deduct and withhold from amounts payable to you.
6. NO ASSIGNMENT, BINDING EFFECT. You may not assign this Letter
Agreement or your obligations hereunder. This Letter Agreement shall be
binding on you and your heirs, beneficiaries, representatives, successors and
assigns. This Letter Agreement will inure to the benefit of the Company and
its respective successors and assigns.
7. GOVERNING LAW. This Letter Agreement shall be governed and
interpreted by the laws of the State of Texas.
8. ATTORNEYS' FEES. If any action at law or in equity is necessary
to enforce or interpret the terms of this Letter Agreement, the prevailing
party in such action shall be entitled to reasonable attorney's fees, costs,
and necessary disbursements in addition to any other relief to which they may
be entitled.
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Mr. P. Xxxxxxx Xxxxxxxx
September 16, 1996
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9. MODIFICATIONS. All additions or modifications to this Letter
Agreement must be made in writing and must be signed by both you and the
Company.
10. SURVIVAL OF CERTAIN COVENANTS. Your obligations contained in
paragraph 4 above shall survive the termination of this Letter Agreement.
If the foregoing accurately states our agreement with respect to the
subject matter hereof, please execute the original and enclosed copy of this
Letter Agreement. Retain the original letter for your files and return the
fully executed duplicate original to me for the Company's files.
Very truly yours,
/s/ XXXXXX XXXXX
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Xxxxxx Xxxxx
President
Accepted and Agreed:
/s/ P. XXXXXXX XXXXXXXX
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P. Xxxxxxx Xxxxxxxx
