CONSULTING AGREEMENT
AGREEMENT made and entered into as of this lst day of August, 1996, by
and among CENTRAL SPRINKLER CORPORATION, ("Central"), CENTRAL SPRINKLER COMPANY
("CSC") and BRADFORD VENTURES LTD. (the "Advisor"). Central and CSC are referred
to herein collectively as the "Companies" and individually as a "Company.
RECITALS
1. The Advisor has certain knowledge and experience in corporate
management and financial matters, business operations and performance, access to
public markets, management relations and corporate acquisitions.
2. The Companies desire to avail themselves of the Advisor's expertise,
and are willing to do so on the terms and conditions set forth herein.
3. The Advisor is willing to render services to the Companies, on the
terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
(a) Retention of Advisor.
(i) Subject to the terms and conditions of this Agreement, the
Companies hereby retain the Advisor, and the Advisor hereby agrees to render
services to the Companies, as a consultant in respect of the business of the
Companies.
(ii) The Advisor shall at all times be and conduct itself as an
independent contractor in respect of the Companies, and shall not, under any
circumstances, create or purport to create any obligation on behalf of the
Companies.
(b) Duties of Adisor. The Advisor shall provide corporate advisory,
financial and other consulting services consistent with the Advisor's expertise
as mentioned above with respect to the affairs and activities of the Companies
in the ordinary course of their businesses, at such times and from time to time
as reasonably requested by the Companies. In performing such services for the
Companies, the Advisor shall, among other things, be provided with information
concerning the business strategy of the Companies, and shall have the full
cooperation of management to review and make recommendations concerning all
material business transactions of whatever type effected or proposed to be
effected by the Companies, and to review and make recommendations concerning all
matters relating to the
manner, method and timing of corporate financing transactions. This Agreement
shall not preclude the payment of additional compensation to the Advisor for
services performed by the Advisor that are beyond the scope of the Advisor's
duties hereunder, such as services as a broker or finder, provided that the
parties agree in writing that the Advisor is entitled to any such additional
compensation.
(c) Other Agreements. It is understood that the Advisor may from time
to time act as consultant to or enter into similar agreements with other
companies that may compete with the Companies, without the necessity of
obtaining approval from the Companies. However, the Advisor will not use or
disclose any confidential information regarding the Companies for the benefit of
any corporation, partnership or other entity or person that competes with the
Companies.
(d) Fees. As consideration for the Advisor's services hereunder,
Central shall pay the Advisor fees of $100,000 per annum. The fees shall be
payable in advance in equal quarterly installments, commencing on August 1, 1996
and continuing on the first day of each quarter thereafter.
(e) Expenses. All reasonable out-of-pocket expenses and other
disbursements incurred by the Advisor in connection with the Advisor's services
hereunder shall be borne by the Companies and/or reimbursed to the Advisor.
(f) Duration. This Agreement shall become effective as of the date
hereof and shall continue in effect until October 31, 1997, but this Agreement
shall thereafter automatically renew for successive one-year terms unless notice
of termination is given by either party to the other at least 90 days prior to
the close of the then-current one-year period. Notwithstanding the foregoing, if
Xxxxxxx X. Xxxxxxx ceases to be an officer of the Advisor, the Companies may
terminate this Agreement upon 30 days' prior notice to the Advisor and have no
further liability to the Advisor except for unpaid fees and expenses accrued
through the date of such termination.
(g) Notices. All notices relating to this Agreement shall be in writing
and shall be deemed to have been given when personally delivered or at the time
when mailed in any general or branch United States Post Office or sent by
Federal Express or a similar overnight courier service, addressed to the other
party at its address stated below, or to such changed address as the other party
may have been given by notice.
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If to the Companies:
Central Sprinkler Corporation
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
FAX: 000-000-0000
If to the Advisor:
Bradford Ventures Ltd.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
FAX: 000-000-0000
(h) Binding Effect; Assignability. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors. This Agreement and the rights and obligations hereunder shall not be
assignable or delegable by the parties hereto.
(i) Indemnification. The Companies agree to indemnify the Advisor, the
partners, officers and directors of the Advisor, and their agents and affiliates
against, and to save and hold them harmless from and in respect of, all (a)
fees, costs and expenses paid in connection with, resulting from or relating to
any claim, action or demand against any and all such indemnified parties that
arise out of or in any way relate to the Companies, their properties, business,
or affairs and (b) such claims, actions and demands and any losses or damages
resulting from such claims, actions and demands, including amounts paid in
settlement or compromise (if recommended by attorneys for the Companies) of any
such claim, action or demand; provided, however, that this indemnity shall not
extend to conduct of such indemnified parties not undertaken in good faith to
promote the best interests of the Companies, nor to any wilful misconduct. If
such an indemnified party seeks indemnification under this Agreement and the
Companies challenge such party's right to indemnification, the Companies shall
advance the amounts claimed hereunder to the indemnified party until a court of
competent jurisdiction determines in a final judgment that the party is not
entitled to indemnification hereunder, in which case the party receiving such
advanced amounts shall return such amounts to the Companies to the extent
specified in such judgment.
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(j) Entire Agreement. This Agreement sets forth the entire agreement
between the parties relating to the subject matter hereof. Any and all prior
agreements or arrangements entered into between the Companies and the Advisor,
including the Consulting Agreement dated June 21, 1993 between the Companies and
the Advisor, are hereby terminated and each of the parties hereto releases and
discharges the other from any and all obligations and liabilities existing under
or by reason of any such agreements. None of the terms, covenants or conditions
hereof may be waived or amended except by a written instrument signed by the
party to be charged therewith.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
BRADFORD VENTURES LTD. CENTRAL SPRINKLER
CORPORATION
By: By:
--------------------------- -----------------------------
CENTRAL SPRINKLER
COMPANY
By:
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