CONSULTING AGREEMENT
Exhibit 10.4
This Consulting Agreement (“Agreement”), effective July 24, 2008 (“Effective Date”), is made
by and between American Reprographics Company, a Delaware corporation, (the “Company”), and
Xxxxxxxxxxxxx Xxxxxxxxxxxx (“Consultant”).
WHEREAS, the Company and Consultant desire that Consultant provide professional services to
the Company as provided below, commencing upon the Effective Date.
NOW, THEREFORE, in consideration of the promises and of the covenants set forth below, the
parties hereto agree as follows:
1. Consulting Services. Consultant will render consulting services on strategic
matters to the Company’s board of directors (collectively, the “Consulting Services”), as the
Company’s board of directors may from time to time direct.
2. Term. The term of this Agreement shall commence July 24, 2008 and continue though
and including June 30, 2010 (the “Consulting Period”).
3. Time Commitment. The Company acknowledges that Consultant has other clients and
that, except where the nature of the Consulting Services requires that they be performed at
specific times, Consultant is free to choose the specific times at which the Consulting Services
will be performed; provided, however, that Consultant shall devote sufficient time to the
Consulting Services to complete them within the time frames agreed by Consultant and the Company.
4. Consulting Fees. In consideration of performance of the Consulting Services
pursuant to Section 1 above, Consultant shall be paid an annual fee in the sum of $325,000 during
the Consulting Period, which fee shall be payable in monthly increments in the amount of $27,083.33
each month, payable on the last business day of each month during the Consulting Period, in
accordance with the Company’s normal payment procedures (“Consulting Fees”). Consultant shall be
responsible for the payment of all taxes in connection with the Consulting Fees imposed by any
taxing authority, and will indemnify the Company from any liability in connection with any
assessment, penalty or interest as a result of any determination by any taxing authority that such
amounts should have been withheld from payments to Consultant.
5. Independent Contractor. It is understood that, during the Consulting Period,
Consultant shall be an independent contractor and not an employee of the Company, and that this
Agreement is not an employment agreement. Consultant shall not be deemed to be an agent, partner
or joint venturer of the Company during the Consulting Period, and the Company shall not exercise
any control or supervision with respect to Consultant’s services.
6. No Conflicts. Consultant represents and warrants that (a) Consultant is not bound
by, and will not enter into, any oral or written agreement with another party that conflicts in any
way with Consultant’s obligations under this Agreement; and (b) Consultant’s agreement and
performance under this Agreement do not require consent or approval of any person that has not
already been obtained.
7. Restrictive Covenants. Consultant acknowledges that (a) Consultant’s consultancy
duties will bring Consultant in close contact with certain confidential affairs and trade secrets
of the Company, its subsidiaries and affiliates (collectively, the “ARC Group”) not readily
available to the public; (b) the agreements and covenants of Consultant contained in Sections 7(a)
and (b) below are essential to the goodwill and business of the ARC Group; and (c) the Company
would not have entered into this Agreement but for the agreements and covenants of Consultant
contained in such sections. Accordingly, as an inducement for the Company to enter into this
Agreement, Consultant agrees that:
(a) Confidential Information. During the Consulting Period and thereafter, Consultant
shall continue to keep secret and retain in strictest confidence, and shall not use for its benefit
or the benefit of others, except in connection with the business and affairs of the ARC Group, all
confidential information or trade secrets of the ARC Group including, without limitation,
information with respect to (i) potential acquisitions, (ii) sales figures, (iii) profit or loss
figures, and (iv) customers, clients, suppliers, sources of supply and customer lists
(collectively, “Confidential Information”) and shall not disclose the Confidential Information to
anyone outside of the ARC Group except with the express written consent of the Company and except
for Confidential Information which is at the time of receipt or thereafter becomes publicly known
through no wrongful act of Consultant. Consultant shall deliver to the Company upon the
termination of its consultancy or at any other time the Company may request, all memoranda, notes,
plans, records, reports, computer discs, software and other documents and data in any tangible
media (and copies thereof) relating to the Confidential Information, Work Product (as defined
below) or the business of the ARC Group which Consultant was provided during the Consulting Period
and which Consultant may then possess or have under its control.
(b) Work Product. All inventions, innovations, improvements, developments, methods,
which relate to the ARC Group’s actual or anticipated business, research and development or
existing or future products or services and which are conceived, developed or made by Consultant
while a consultant to the Company (collectively, “Work Product”) belong to the Company. Consultant
shall promptly disclose such Work Product to the Company and perform all actions requested by the
Company (whether during or after the term) to establish and confirm such ownership (including,
without limitation, assignments, consents, powers of attorney and other instruments). Consultant
acknowledges and agrees that upon expiration or termination of this Agreement, or at the request of
the Company from time to time, Consultant shall deliver all Work Product in its possession to the
Company.
Consultant agrees that the covenants contained in this Section 7 are necessary and reasonable
in order to protect the Company in the conduct of its business
and protect the Company’s goodwill, and are entered into in consideration for the Company entering
into and performing under this Agreement.
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The Company and Consultant intend that each of the above restrictions in this Section 7 is to
be completely severable and independent of each other, and any invalidity or unenforceability of
any one or more of such restrictions shall not render invalid or unenforceable any one or more of
the other restrictions.
8. Injunctive Relief. Consultant specifically recognizes that any breach of Section 7
will cause irreparable injury to the Company and that actual damages may be difficult to ascertain,
and in any event, may be inadequate. Accordingly (and without limiting the availability of legal
or equitable, including injunctive, remedies under any other provisions of this Agreement),
Consultant agrees that in the event of any such breach, the Company shall be entitled to injunctive
relief in addition to such other legal and equitable remedies that may be available.
9. Survival. Consultant agrees that the provisions in Section 7 will survive the
termination or expiration of this Agreement.
10. Modification. In the event that any covenant set forth in Section 7 is deemed
void or unenforceable by a court for any reason, it is the parties’ intent that the court will
modify the covenant so as to make it valid and enforceable.
11. Assignability of Agreement. The rights and duties of the parties hereunder shall
not be assignable, except that the Company may assign this Agreement and all rights and obligations
hereunder to any corporation or other business entity which succeeds to all or substantially all of
the business of the Company through merger, consolidation, corporate reorganization or by
acquisition of all or substantially all of the assets of the Company provided that the corporation
or other business entity assumes the obligations of the Company hereunder; provided, further,
however, that such assignment shall not relieve the Company of its obligations hereunder.
12. Integration. This Agreement contains the entire agreement between the parties and
supersedes all prior oral and written agreements, understandings, commitments and practices between
the parties, including any prior employment agreements, whether or not fully performed before the
date of this Agreement; provided, however, that the post-employment covenants contained in the
Consultant’s Employment Agreement with the Company which has now terminated shall remain in effect
to the extent they are consistent with and not superseded by this Agreement such that in the event
of any conflict the terms of this Agreement will prevail. No amendments to this Agreement may be
made except by a writing signed by both parties.
13. Litigation. In the event legal action is brought to enforce any of the provisions
of this Agreement or for any breach thereof, reasonable attorneys’ fees shall be awarded to the
prevailing party or parties in said action.
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14. Notices. All notices, requests, demands, claims, and other communications
hereunder will be in writing. Any notice, request, demand, claim, or other communication hereunder
shall be deemed duly given if (and then two (2) business days thereafter) it is sent by registered
or certified mail, return receipt requested, postage prepaid, and addressed to the intended
recipient as set forth below:
If to Consultant:
|
Xxxxxxxxxxxxx Xxxxxxxxxxxx | |
| 0000 Xxxx Xxxx Xxxx | ||
| Xx Xxxxxx, XX 00000 | ||
If to the Company:
|
American Reprographics Company | |
| 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000 | ||
| Xxxxxxxx, XX 00000 | ||
| Attn: Xxxxxxxx X. Xxxxxx |
Any party may send any notice, request, demand, claim, or other communication hereunder to the
intended recipient at the address set forth above using any other means (including personal
delivery, expedited courier, messenger service, telecopy, ordinary mail, or electronic mail), but
no such notice, request, demand, claim, or other communication shall be deemed to have been duly
given unless and until it actually is received by the intended recipient. Any party may change the
address to which notices, requests, demands, claims, and other communications hereunder are to be
delivered by giving the other party notice in the manner herein set forth.
15. Controlling Law. This Agreement is entered into in the State of California and
shall be interpreted and governed by the laws of the State of California, without regard to its
conflict of law provisions.
16. Successors. Subject to Section 11 hereof, this Agreement shall be binding on and
shall inure to the benefit of the parties to it and their respective successors and assigns.
17. Severability. If a court of competent jurisdiction finds any provision in this
Agreement to be invalid, such invalidity shall not affect the remainder of the Agreement. The
invalid provision shall be deemed severed therefrom and the remainder of the Agreement shall remain
enforceable in accordance with its terms and of full force and effect.
18. Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together will constitute one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date.
COMPANY:
AMERICAN REPROGRAPHICS COMPANY,
a Delaware corporation
a Delaware corporation
| /s/ Kumarakulasingam Xxxxxxxxxxx | ||
By:
|
Kumarakulasingam Xxxxxxxxxxx | |
Its:
|
Chief Executive Officer | |
CONSULTANT:
/s/ Xxxxxxxxxxxxx Xxxxxxxxxxxx Xxxxxxxxxxxxx Xxxxxxxxxxxx
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