CONSULTING AGREEMENT dated as of March 1,
1995, between CONVERSION TECHNOLOGIES
INTERNATIONAL, INC., a Delaware corporation
(the "Company"), and XXXXXXX X. XXXX (the
"Consultant"), As Amended.
The Company is a specialty materials company engaged in the business of
developing and manufacturing advanced industrial abrasives, specialty glass and
glass-ceramic products utilizing, among other things, industrial waste stream
recycling and conversion technologies (the "Business"). The Company desires to
retain the Consultant to provide certain services to the Company and the
Consultant desires to provide such services to the Company in accordance with
the terms and conditions hereof.
NOW THEREFORE, in consideration of and for the mutual promises and
covenants contained herein, the parties hereto agree as follows:
1. Consulting Services.
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(a) Subject to the terms and conditions hereinafter set forth, the Company
retains the Consultant, and the Consultant hereby accepts such retention by the
Company, effective as of the date hereof, to undertake the following consulting
and advisory services:
(i) provide to the Company strategic and tactical advice and
services relating to, among other things, competitive positioning of
the Company and its subsidiaries within the markets in which they
compete, strategic fit and potential synergies of product lines of
others, organizational development of the Company and its
subsidiaries, joint venture and teaming opportunities, environmental
regulatory strategies, industry trends and identification of potential
acquisitions and joint venture candidates;
(ii) assist in strategic planning, in an effort to position CTI
toward profitability; fund
raising and other capital structure activities; investor relations and
communications activities; and engage in business development
activities;
(iii) serve as the Company's chief environmental officer and
oversee, monitor and advise with respect to materials management at
the Company's facilities and environmental matters generally (in such
capacity, Xx. Xxxx is hereby authorized to confer with the New York
Job Development Authority, as may be required, as well as such other
agencies or parties deemed appropriate); and
(iv) such other matters that the Chief Executive Officer or the
Board of Directors of CTI may reasonably request that are within the
Consultant's areas of expertise and experience and that the Consultant
agrees to perform.
(b) The Company and the Consultant hereby acknowledges and agree that the
Consultant shall perform the services pursuant to paragraph (a) above
(collectively, the "Consulting Services") as an independent contractor and not
as an agent, employee or legal representative of the Company, and that the
Consultant shall not have authority to bind the Company in any manner. The
Consultant agrees that he shall use his best reasonable efforts in providing the
Consulting Services hereunder and shall keep the Company apprised of his
progress on the Consulting Services from time to time and when requested by the
Board of Directors or Chief Executive Officer of the Company.
(c) The Company and the Consultant agree that the Consultant may from time
to time be assigned special projects within the scope of the Consulting Services
as outlined above or as otherwise agreed to by the Consultant and the Chief
Executive Officer at additional compensation to be agreed upon by the parties.
(d) During the Term, the Consultant will visit the operating facilities of
the Company and its subsidiaries and be reasonably available for telephonic and
in person conferences and meetings commensurate with the compensation being paid
hereunder.
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2. Consideration for Consulting Services.
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(a) In consideration of the Consultant's performance of the Consulting
Services during the Term of this agreement, the Company shall pay to the
Consultant a consulting fee of $8,000 per month, payable monthly in arrears,
commencing as of the date hereof. In addition, the Consultant will receive, in
lieu of the options contemplated by the February Amendment (which were not
issued), non-qualified options to purchase 300,000 shares of Common Stock of CTI
at an exercise price equal to $1.375, effective as of July 22, 1997, pursuant to
a meeting of the Compensation Committee of the Board of Directors as of such
date. Of such options, 60,000 will be vested immediately and 60,00 will vest on
each of the first, second, third and fourth anniversaries of the date hereof,
subject to the vesting provisions to be set forth in a non-qualified stock
option agreement to be entered into by the parties.
3. Reimbursement of Expenses.
-------------------------
The Company shall reimburse the Consultant for his reasonable out-of-pocket
expenses incurred in connection with the Consulting Services and approved in
advance by the Chief Executive Officer of the Company. Reimbursement for any
expenses as provided for herein shall be made to the Consultant within thirty
(30) days following receipt by the Company of satisfactory evidence of the
incurrence of such expenses and the Consultant's written request for such
reimbursement.
4. Term.
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The term (the "Term") of this Agreement shall commence on August 7, 1997
and shall end on August 7, 2000; provided, however, that this Agreement may be
extended by the mutual written agreement of the parties hereto. Notwithstanding
the foregoing, this Agreement may be terminated by either party in the event of
a material breach by the other party if such breach is not cured (if curable)
within 30 days following written notice thereof. Notwithstanding anything
contained herein to the contrary, in the event that the Consultant is removed as
Chairman of the Board of the Company by the Board of Directors of the Company
(other than as a result of a breach of fiduciary
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duty, conviction of a felony or material breach of this Agreement), unless
otherwise agreed to by the parties, (i) this Agreement shall automatically
terminate, (ii) the Consultant shall receive a lump sum cash payment equal to
the amount of the then remaining money payments hereunder (calculated from the
date of termination through March 1, 2000) and (iii) all unvested options held
by the Consultant granted in accordance with Section 2 (a) of this Agreement
shall become immediately exercisable.
5. Nondisclosure of Confidential Information.
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(a) The Consultant acknowledges that the Company would be irreparably
harmed if confidential information relating to the business and strategies of
the Company and its subsidiaries were disclosed to competitors or potential
competitors of the Company and its subsidiaries. Accordingly, the Consultant
shall not (i) disclose to any person, firm, corporation, association or other
entity any Confidential Information (as defined below) for any reason or purpose
whatsoever or (ii) make use of any such Confidential Information for his own
purpose or for the benefit of any person, firm, corporation, association or
other entity except the Company or its subsidiaries. For purposes of this
Agreement, the term "Confidential Information" shall mean any information
relating to the Company or any of its subsidiaries that the Consultant may
acquire by reason of his association with the Company or any of its
subsidiaries, except for (i) information which is in the public domain at the
time of receipt thereof by the Consultant, (ii) information which, after receipt
thereof by the Consultant, becomes part of the public domain through no improper
act or omission of the Consultant, and (iii) information which was lawfully
within the Consultant's possession prior to the initial commencement of the
Consultant's association with the Company or any of its subsidiaries. The
foregoing provisions shall not preclude the use or disclosure by the Consultant
of Confidential Information (i) in the performance of his obligations hereunder
or (ii) to the extent required by law.
6. Restrictive Covenants.
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(a) The Consultant acknowledges the highly competitive nature of the
business conducted by the Company
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and its subsidiaries. Accordingly, as an inducement to the Company to enter into
this Agreement and in partial consideration of the amounts to be received
hereunder, the Consultant, shall not, during the term hereof and for the
two-year period thereafter, (i) directly or indirectly engage in or represent in
any way any business (such business being referred to herein as a "Competing
Business") competing with the business of the Company or any of its subsidiaries
of converting waste into glass and ceramic products, whether such engagement
shall be as an officer, director, owner, employee, partner, or other participant
in any Competing Business, (ii) assist others in engaging in any Competing
Business in the manner described in clause (i) above, (iii) induce any employees
of the Company or any of its subsidiaries to terminate their employment with the
Company or any such subsidiaries or to engage in any Competing Business or (iv)
induce any entity or person with which the Company or any of subsidiaries has a
business relationship to terminate or alter such business relationship;
provided, however, that nothing contained in this Section 6(a) shall prevent,
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restrain or otherwise restrict the Consultant from owning 5% or less of any
class of securities of any corporation so long as such securities are listed for
trade by NASDAQ in the over-the-counter market or are traded on a national
securities exchange.
(b) The Consultant understands that the foregoing restrictions may limit
his ability to earn a livelihood in a business similar to the Business of the
Company and its subsidiaries, but he nevertheless believes that he has received
and will receive sufficient consideration and other benefits as a Consultant of
the Company as provided hereunder to justify such restrictions.
7. Injunctive Relief.
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The Consultant acknowledges that damages may not be an adequate remedy for
a breach of Section 6 or 7 hereof and agrees that injunctive relief in favor of
the Company would be an appropriate remedy for such breach. Nothing herein
contained, however, shall be construed as prohibiting the Company from pursuing
any remedies which may be available to it for such breach or threatened breach
or any other breach of this consulting Agreement.
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8. No Breach of Duty.
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The Consultant represents and warrants to the Company that the performance
by him of this Agreement will not breach any agreement or duty to keep in
confidence proprietary information acquired by it in confidence or in trust
prior to the Consultant's engagement hereunder or any duty not to compete with
any party. The Consultant further agrees that it shall not enter into any
agreement in conflict herewith during the Term.
9. Assignment.
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This Agreement shall not be assignable by either party hereto without the
written consent of the other party hereto; provided, however, that the Company
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may assign this Agreement to any successor of the Company, whether by merger,
consolidation, transfer of all or substantially all its assets or otherwise,
without the prior written consent of the Consultant.
10. Severability.
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Every provision of this Agreement is intended to be severable. If any term
or provision hereof is deemed unlawful or invalid in any jurisdiction for any
reason whatsoever, such unlawfulness or invalidity shall not affect the validity
of the remainder of this Agreement or the enforceability of such term or
provision in any other jurisdiction. To the extent that any such term or
provision is held to be unlawful or invalid, the parties agree to reform such
term or provision in such a way which will be enforceable in the jurisdiction to
which such holding applies, and which will reflect, as nearly as permissible,
the intention of the parties.
11. Notices.
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All notices and other communications required or permitted hereunder shall
be sufficient if delivered personally or sent by nationally recognized overnight
courier, by facsimile or by registered or certified mail, return receipt
requested and postage prepaid, addressed as follows:
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if to the Consultant, to
Xxxxxxx X. Xxxx
0000 X.X. 00xx Xxxx.
Xxxx Xxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
if to the Company, to:
Conversion Technologies International, Inc.
0000 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Amt;
with a copy to:
Xxxxxxxx Ingersoll
000 Xxxxxxx Xxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.;
or to such other address as the party to whom notice is to be given may have
furnished to the other party. Any such notice or communication shall be deemed
to have been received (a) in the case of personal delivery, on the date of such
delivery, (b) in the case of nationally-recognized overnight courier, on the
next business day following dispatch, (c) in the case of facsimile transmission,
when received, and (d) in the case of mailing, on the fifth business day
following the day on which the piece of mail containing such communication is
posted.
12. Entire Agreement.
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This Agreement constitutes the entire agreement and understanding between
the Company and the Consultant regarding the subject matter hereof and
supersedes any and all negotiations, prior discussions and preliminary and prior
agreements and understandings related to the subject matter hereof.
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13. Governing Law.
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This Agreement shall in all respects be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed wholly therein.
14. Counterparts.
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This Agreement may be executed in one or more counterparts, each of which,
when so executed shall be deemed to be an original and all of which
counterparts, taken together, shall constitute one and the same instrument.
15. Modification.
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Neither this Agreement nor any term hereof may be amended, modified,
supplemented or waived unless in a written instrument executed by the Company
and the Consultant.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
CONVERSION TECHNOLOGIES
INTERNATIONAL, INC.
By: /s/Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx
Chief Executive Officer
THE CONSULTANT:
/s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
