EXHIBIT 10.11
CONSULTING AND MANAGEMENT SERVICES AGREEMENT
THIS CONSULTING AND MANAGEMENT SERVICES AGREEMENT ("Agreement") is made
and entered into as of the 24th day of February, 1997, by and between Sunglass
Hut International, Inc., a Florida corporation (the "Company"), and Xxxxxxxx &
Company, Inc., a Florida corporation ("Xxxxxxxx").
1. APPOINTMENT OF XXXXXXXX. The Company appoints Xxxxxxxx and Xxxxxxxx
accepts appointment on the terms and conditions provided in this Agreement, to
serve as a consultant to the Company's business.
2. BOARD OF DIRECTORS SUPERVISION. The activities of Xxxxxxxx to be
performed under this Agreement shall be subject to the supervision of the Board
of Directors of the Company (the "Board") to the extent required by applicable
law or regulation and subject to reasonable policies not inconsistent with the
terms of this Agreement adopted by the Board and in effect from time to time.
Where not required by applicable law or regulation, Xxxxxxxx shall not require
the prior approval of the Board to perform its duties under this Agreement.
3. AUTHORITY OF XXXXXXXX. Subject to any limitations imposed by
applicable law or regulation, Xxxxxxxx shall render management and consulting
services to the Company which services shall include advice and assistance
concerning any and all aspects of the operations, planning and financing of the
Company as needed from time to time. Such Xxxxxxxx services shall include (i)
assisting in locating, interviewing and recruiting senior executive candidates,
(ii) analyzing and reviewing the Company's proposed budget for fiscal 1997 and
future periods, (iii) making recommendations concerning the Company's business
strategies, (iv) working with management in establishing and monitoring the
Company's financial and other controls, (v) providing advice and consultation in
all areas of executing the Company's business plan, (vi) conducting relations on
behalf of the Company with accountants, attorneys and other professionals, and
(vii) making periodic reports to the Board with respect to the consulting
services provided hereunder. Without limiting the generality of the foregoing,
Xxxxxxxx will use its best efforts to cause Xxxxx X. Xxxxxxxx to devote
substantially all his working time and attention to the business and affairs of
the Company and to give the Company the benefit of his special knowledge, skill
and business expertise to promote the Company's interests.
4. REIMBURSEMENT OF EXPENSES; INDEPENDENT CONTRACTOR. All obligations
or expenses incurred by Xxxxxxxx in the performance of its duties under this
Agreement shall be for the account of, on behalf of, and at the expense of the
Company. Xxxxxxxx shall not be obligated to make any advance to or for the
account of the Company or to pay any sums, except out of funds held in accounts
maintained by the Company nor shall Xxxxxxxx be obligated to incur any liability
or obligation for the account of the Company without assurance that the
necessary funds for the discharge of such liability or obligation will be
provided. Xxxxxxxx shall be an independent contractor, and nothing obtained in
this Agreement shall be deemed or construed (i) to create a partnership or joint
venture between the Company and Xxxxxxxx, or (ii) to cause Xxxxxxxx to be
responsible in any way for the debts, liabilities or obligations of the Company
or any other party, or (iii) to constitute any of Xxxxxxxx'x employees, officers
or affiliates as employees, officers or agents of the Company. It is understood
that Xxxxx X. Xxxxxxxx will continue to serve as the Company's Chairman of the
Board in accordance with the Company's bylaws.
5. MANAGEMENT FEE. In consideration of Xxxxxxxx'x agreement to provide
the management services described in Section 3 of this Agreement, the Company
shall pay to Xxxxxxxx an annual base cash consulting and management fee equal to
$375,000, payable in monthly installments. Except as expressly provided in
Section 6, any bonus, grant of securities or payment of other additional
consideration shall be due only if approved by the Board in its sole discretion.
6. SUSPENSION OF CHAIRMAN'S CONSULTING FEES. It is agreed that, during
the term of this Agreement, neither Xxxxx X. Xxxxxxxx nor Xxxxxxxx shall receive
any fee or other compensation in
connection with Xxxxx X. Xxxxxxxx'x service on the Board, except for (x) the
annual director's fee and meeting fees paid to all non-employee directors of the
Company, and (y) the annual grants of options and restricted stock to be made to
non-employee directors pursuant to the Company's 1996 Executive Incentive
Compensation Plan, all of which fees and awards shall continue.
7. EXPENSE REIMBURSEMENT AND OTHER BENEFITS.
7.1 EXPENSE REIMBURSEMENT. During the term of Xxxxxxxx'x
engagement hereunder, the Company shall, consistent with the Company's policies
and internal audit procedures and upon the submission of supporting
documentation by Xxxxxxxx or its representatives, reimburse Xxxxxxxx for all
reasonable expenses actually paid or incurred by Xxxxxxxx or its representatives
in the course of and pursuant to the business of the Company, including expenses
for travel and entertainment. It is expressly agreed that the Company will (x)
provide Xxxxxxxx with a non-accountable administrative expense allowance of
$8,500 per month, which is intended to defray in part the expenses incurred by
Executive in maintaining its Greenwich, Connecticut offices, and (y) reimburse
Xxxxxxxx for weekly, round-trip, first class air fare between New York and
Miami.
7.2 OTHER BENEFITS. The Company shall obtain or shall
continue in force, at the Company's sole expense, comprehensive major medical
and hospitalization insurance coverages, including dental coverages, either
group or individual, for Xxxxx X. Xxxxxxxx in accordance with present practices.
The policies to be provided by the Company shall be on terms as determined by
the Board. Nothing paid to Xxxxxxxx or Xxxxx X. Xxxxxxxx under any plan or
arrangement presently in effect or made available in the future shall be deemed
to be in lieu of the base fee payable to Xxxxxxxx pursuant to this Agreement.
7.3 WORKING FACILITIES. The Company shall furnish Xxxxx X.
Xxxxxxxx with an office, secretarial assistance and such other facilities and
services suitable to his position as Chairman of the Board and adequate for the
performance of Xxxxxxxx'x duties hereunder.
7.4 HOUSING. The Company shall arrange and pay all costs of
leasing, maintaining and furnishing a Miami, Florida apartment for Xxxxx X.
Xxxxxxxx during the term of this Agreement, up to a maximum of $3,300 per month.
7.5 AUTOMOBILE ALLOWANCE. Subject to the approval of the
Chairman of the Compensation Committee of the Board, the Company shall arrange
for (or reimburse Xxxxxxxx for the reasonable costs of) any necessary use of an
automobile by Xxxxxxxx for Company business from time to time during the term
hereof.
8. TERM. This Agreement shall remain in effect until terminated in
accordance with the provisions of this Agreement. Either the Company or Xxxxxxxx
may terminate this Agreement (x) upon 30 days' written notice to the other, or
(y) in the event of the breach of any of the material terms or provisions of
this Agreement by the other party, which breach is not cured within 10 business
days after written notice of the same is given to the party alleged to be in
breach.
9. STANDARD OF CARE. Xxxxxxxx (including any person or entity acting
for or on behalf of Xxxxxxxx) shall not be liable for any mistakes of fact,
errors of judgment, for losses sustained by the Company or for any acts or
omissions of any kind (including acts or omissions of Xxxxxxxx), unless the
Company's losses (including expenses, costs and attorneys' fees) are finally and
judicially determined to have resulted from the gross negligence or willful
misconduct of Xxxxxxxx.
10. INDEMNIFICATION OF XXXXXXXX. The Company hereby agrees to indemnify
and hold harmless Xxxxxxxx and its present and future officers, directors,
affiliates, employees and agents ("Indemnified Parties") to the fullest extent
that Xxxxx X. Xxxxxxxx is required to be indemnified in accordance with his
existing Indemnification Agreement with the Company. The Company further agrees
to advance and
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reimburse the Indemnified Parties on a monthly basis for any cost of defending
any action or investigation arising in connection with his services hereunder
(including attorneys' fees and expenses), subject to an undertaking from such
Indemnified Party to repay the Company if such party is determined not to be
entitled to such indemnity.
11. NO ASSIGNMENT. Without the consent of Xxxxxxxx, the Company shall
not assign, transfer or convey any of its rights, duties or interest under this
Agreement, nor shall it delegate any of the obligations or duties required to be
kept or performed by it hereunder. Without the prior written consent of the
Company, Xxxxxxxx shall not assign, transfer or convey any of its rights, duties
or interests under this Agreement, nor shall it delegate any of the obligations
or duties required to be kept or performed by it under this Agreement.
12. NOTICES. All notices, demands, consents, approvals and requests
given by either party to the other hereunder shall be in writing and shall be
personally delivered or sent by registered or certified mail, return receipt
requested, postage prepaid, to the parties at the following addresses:
If to the Company: Sunglass Hut International, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxxxx, President
If to Xxxxxxxx: Xxxxxxxx & Company, Inc.
Xxx Xxxxxxxxx Xxxxx, Xxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx, President
Any party may at any time change its respective address by sending written
notice to the other party of the change in the manner hereinabove prescribed.
13. SEVERABILITY. If any term or provision of this Agreement or the
application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or enforceable, shall not be affected thereby, and each term
and provision of this Agreement shall be valid and be enforced to the fullest
extent permitted by law.
14. NO WAIVER. The failure by any party to exercise any right, remedy
or elections herein contained or permitted by law shall not constitute or be
construed as a waiver or relinquishment for the future exercise of such right,
remedy or election, but the same shall continue and remain in full force and
effect. All rights and remedies that any party may have at law, in equity or
otherwise upon breach of any term or condition of this Agreement, shall be
distinct, separate and cumulative rights and remedies and no one of them,
whether exercised or not, shall be deemed to be in exclusion of any other right
or remedy.
15. ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties hereto with respect to the matters herein contained and any
agreement hereafter made shall be ineffective to effect any change or
modification, in whole or in part, unless such agreement is in writing and
signed by the party against whom enforcement of the change or modification is
sought.
16. GOVERNING LAWS. This Agreement shall be governed by and construed
in accordance with the laws of the State of Florida without reference to the
laws of any other state.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly exercised by their authorized representatives as of the date first above
written.
SUNGLASS HUT INTERNATIONAL, INC.
By:______________________________________________
Xxxx X. Xxxxxxx,
President and Chief Executive Officer
XXXXXXXX & COMPANY, INC.
By:______________________________________________
Xxxxx X. Xxxxxxxx,
President and Chief Executive Officer
Agreed to And Acknowledged:
_________________________________________________
Xxxxx X. Xxxxxxxx, Individually
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