EXHIBIT 4.1
CONSULTING AGREEMENT
AGREEMENT dated as of February 27, 1997 by and between XXXXXXX COMPANIES,
INC., a Delaware corporation having an office at 0000 Xxxxxxx Xxxxx, Xxxxxxxx,
Xxxx 00000 (the "Company"), and XXXX XXXXX (the "Consultant"), having an office
at 000 Xxxxx Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000.
W I T N E S S E T H:
WHEREAS, the Company wishes to retain Consultant to provide the Company
with certain consulting services and Consultant is willing to provide such
consulting services, on the terms and conditions set forth herein,
NOW, THEREFORE, in consideration of the foregoing premises and of the
mutual covenants and agreements hereinafter contained, the parties hereby agree
as follows:
SECTION 1. Retention; Duties. On the terms and subject to the conditions herein
contained, the Company hereby engages Consultant as a consultant, and Consultant
hereby accepts such engagement. Consultant's duties shall be to consult with the
Board of Directors and management of the Company, from time to time, as
requested by the Company with regard to operations, strategic planning and
business development, including targeting of acquisitions for the Company and
such other aspects of the business of the Company as Consultant and the Company
may agree from time to time. Consultant agrees to use his best efforts to
perform all services required hereunder in a competent and timely manner.
SECTION 2. Term of the Agreement.
(a) The term of this Agreement shall commence as of the date first set
forth above, and, unless earlier terminated pursuant hereto, shall continue for
a period of two (2) years.
(b) In the case of any material breach by Consultant of his obligations
under this Agreement, the Company may terminate this agreement upon thirty (30)
days written notice, such notice to describe the breach in detail, unless
Consultant has cured the breach within such thirty (30) day period, or in the
event that the breach cannot be cured within such period, Consultant has
commenced with due diligence to cure such breach.
(c) The termination of this Agreement by either party hereto shall not
affect, restrict, diminish or remove any rights, obligations or remedies held or
arising by either party under the terms of this Agreement up to and through the
effective date of termination hereof.
SECTION 3. Consultant's Compensation. The Company shall issue to Consultant
150,000 shares of the Company's common stock, $.01 par value (the "Common
Stock") for services previously rendered to the Company, and commencing July 1,
1997 shall pay to Consultant the sum of $6,000 per month on or before the tenth
day of each month.
SECTION 4. Other Benefits and Expenses
The Company shall pay or reimburse Consultant for all reasonable and
necessary expenses incurred by him in connection with his duties hereunder, upon
submission by Consultant to the Company of such written evidence of such expense
as the Company may
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require. The Consultant shall obtain the prior written approval of the Company
for any expense in excess of $200.
SECTION 5. Confidentiality. Consultant understands that, in performing his
responsibilities hereunder, he will have access to Confidential Information (as
hereinafter defined) of the Company. Consultant shall hold in strict confidence
unless compelled to disclose by judicial or administrative process, or, in the
opinion of counsel, by other requirements of law, Confidential Information (as
hereinafter defined) and shall not release or disclose such information to any
other person, except his employees, auditors, attorneys, representatives and
other advisors and agents in connection with this Agreement and the services to
be provided hereunder, provided that any such person shall have first been
advised of and agreed to the confidentiality provisions of this Section 5. For
purposes hereof, "Confidential Information" shall mean all information of any
kind which the Company deems to be confidential, except information (1)
disclosed in any filing by the Company pursuant to the Securities Exchange Act
of 1934, (2) available to the public other than as a result of a disclosure by
Consultant in violation of the terms hereof, (3) available to Consultant on a
non-confidential basis prior to disclosure to Consultant by the Company, or (4)
available to Consultant on a non-confidential basis from a source other than the
Company, provided that such source is not known by Consultant to be bound by a
confidentiality agreement with the Company or otherwise is known by Consultant
to be prohibited by a contractual, legal or fiduciary obligation from
transmitting the information to Consultant.
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SECTION 6. No Solicitation. Consultant agrees that during the term of this
Agreement and for a period of one (1) year following the expiration of this
Agreement, he will not solicit the employment of any employee of the Company on
behalf of any other person, firm, corporation or other entity or otherwise
interfere with the employment relationship between any employee or officer of
the Company and the Company.
SECTION 7. Limitation of Liability; Indemnification.
(a) Consultant shall have no liability to the Company, its shareholders or
to any third party for any losses, liabilities, obligations, fines, injunctions
or other costs or expenses of any kind directly or indirectly sustained, or
incurred or arising as a result of the services that are the subject of this
Agreement (or any action or inaction of any third party retained by or acting on
behalf of Consultant hereunder) or for any other cause or reason, except as may
result from Consultant's gross negligence or wilful misconduct in the
performance of his duties hereunder.
(b) The Company agrees to indemnify and hold Consultant harmless from and
against any losses, claims, damages or liabilities, joint or several, to which
Consultant may become subject in connection with the services which are the
subject of this Agreement, and to reimburse Consultant for any out-of-pocket
expenses including reasonable fees and expenses of counsel (including the cost
of any investigation and preparation) incurred by Consultant in connection
therewith, whether or not resulting in any liability; provided, however, that
the Company shall not be liable under the foregoing indemnity to the extent that
a court having jurisdiction shall have determined by a final judgment that such
loss, claim, damage or liability resulted from the
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willful misconduct or gross negligence of Consultant. This indemnification shall
remain in full force and effect following the completion or termination of this
Agreement.
(c) Consultant agrees to indemnify and hold the Company harmless from and
against any losses, claims, damages or liabilities, joint or several, to which
the Company may become subject in connection with the services which are the
subject of this Agreement, and to reimburse the Company for any out-of-pocket
expenses including reasonable fees and expenses of counsel (including the cost
of any investigation and preparation) incurred by the Company in connection
therewith, whether or not resulting in any liability; provided, however, that
Consultant shall not be liable under the foregoing indemnity except to the
extent that a court having jurisdiction shall have determined by a final
judgment that such loss, claim, damage or liability resulted from the willful
misconduct or gross negligence of Consultant. The indemnity agreement in this
paragraph shall, upon the same terms and conditions, extend to and inure to the
benefit of each person, if any, who may be deemed to control the Company and to
the respective officers, directors, employees and advisors of the Company and
such control persons. This indemnification shall remain in full force and effect
following the completion or termination of this agreement.
(d) If any lawsuit or enforcement action is filed against any party
entitled to the benefit of indemnity under this Section 7 by any third party,
written notice thereof shall be given to the indemnifying party as promptly as
practicable; provided that the failure of any indemnified party to give timely
notice shall not affect rights to indemnification hereunder except to the extent
that the indemnifying party demonstrates that such failure was prejudicial to
the ability of the indemnifying party to defend such lawsuit or action and
resulted in increased cost to the indemnifying party pursuant to this Section 7.
After such notice, if the indemnifying party shall
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acknowledge in writing to such indemnified party that such indemnifying party
shall be obligated under the terms of its indemnity hereunder in connection with
such lawsuit or action, then the indemnifying party shall be entitled, if it so
elects, to take control of the defense and investigation of such lawsuit or
action and to employ and engage attorneys of its own choice to handle and defend
the same, at the indemnifying party's cost, risk and expense; and such
indemnified party shall cooperate in all reasonable respects, at the
indemnifying party's cost, risk and expense, with the indemnifying party and
such attorneys in the investigation, trial and defense of such lawsuit or action
and any appeal arising therefrom; provided, however, that the indemnified party
may, at its own cost, participate in such investigation, trial and defense of
such lawsuit or action and any appeal arising therefrom. However, if the
defendants in any action involve both the indemnifying party and the indemnified
party, and the indemnified party concludes that representation of both the
indemnifying party and the indemnified party by the same counsel is
inappropriate under applicable standards of professional conduct due to actual
or potential differing interests between them or for some other reason, then the
indemnifying party shall have the right, at the expense of the indemnifying
party, to select separate counsel to assume such legal defenses and to otherwise
participate in the defense of such action on behalf of the indemnified party.
(e) In the case of any legal action directly between the Company and
Consultant with regard to any matter covered by the provisions of this Section
7, the non-prevailing party shall pay all reasonable attorney's fees and
expenses of the prevailing party incurred solely as a result of such action.
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SECTION 8. Authorization. Each party hereto has taken all necessary action
to duly authorize the execution, delivery and performance of this Agreement.
SECTION 9. Modification. Except as otherwise provided herein, this
Agreement may not be modified, changed, discharged, waived or terminated except
by an instrument in writing signed by the party against whom the enforcement of
any such modification, change, discharge, waiver or termination is sought.
SECTION 10. Entire Agreement. This Agreement constitutes the entire
Agreement between the parties with respect to the subject matter hereof and
supersedes all prior and contemporaneous arrangements or understandings with
respect thereto.
SECTION 11. Notices. All notices and other communications hereunder to any
party shall be in a written instrument delivered by hand or duly sent by first
class, registered or certified mail, return receipt requested and postage
prepaid, addressed to such party at the address set forth on the first page of
this Agreement or such other address as may hereafter by designated in writing
by the addressee. All such notices and communications shall be deemed to have
been received (a) in the case of personal delivery, on the date of such
delivery, and (b) in the case of mailing, on the fifth day following the date of
such mailing.
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SECTION 12. Survival. The indemnification granted under Section 7 above shall
survive the termination or cancellation of this Agreement and shall be binding
upon and inure to the benefit of the parties hereto, their successors and
assigns.
SECTION 13. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors,
permitted assigns and representatives. This Agreement shall not be assignable in
whole or in part, in any of its terms, obligations, responsibilities or
provisions by any party hereto without the express written consent of the other
party; provided, however, that this provision shall in no way limit the right of
Consultant to enlist, hire or retain counsel, consultants, advisors, experts or
other third parties to assist him in carrying out and administering his duties
and responsibilities hereunder.
SECTION 14. Relationship. The sole relationships existing between the Company
and Consultant shall be that as specifically provided under the terms of this
Agreement. This Agreement shall not be construed as creating any partnership,
joint venture or any other form of joint operation or organization wherein the
parties hereto are deemed to be partners.
SECTION 15. Cooperation. The parties hereto agree to execute and deliver from
time to time such additional documents, instruments, agreements, and other
evidences of authority as may be necessary or prudent to carry out the intent of
this Agreement and the transactions contemplated hereby.
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SECTION 16. Counterparts. This Agreement may be executed in any number of
counterparts and each such counterpart hereof shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
agreement.
SECTION 17. Severability. The invalidity or unenforceability of any provision
hereof shall in no way effect the validity or enforceability of any other
provision. The parties to this Agreement agree and intend that this Agreement
shall be enforced as fully as it may be enforced consistent with applicable
statutes and rules of law.
SECTION 18. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Ohio, without giving
effect to principles of conflicts of law.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first set forth above.
XXXXXXX COMPANIES, INC.
/s/ Xxxx Xxxxxxx
By: -----------------------------------
Name: Xxxx Xxxxxxx
Title: Chairman and Chief
Executive Officer
/s/Xxxx Xxxxx
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XXXX XXXXX
