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EXHIBIT 10.20
CONSULTING AGREEMENT
MARK AUERBACH & OAKHURST COMPANY, INC.
Agreement (this "AGREEMENT") made effective this 19th day of December 1995 by
and between Oakhurst Company, Inc. (the "COMPANY") and Mark Auerbach ("MR.
AUERBACH") upon the following terms and conditions:
1. TERM:
(a) The term of this Agreement shall commence on December 19, 1995
and shall continue through December 31, 1996.
(b) The Company shall have the option to extend this Agreement for
an additional one-year period commencing January 1, 1997 and
ending December 31, 1997 by giving Mr. Auerbach written notice
of such extension on or before October 1, 1996.
(c) During the last three calendar months of the Term (as defined
below), upon the request of the Company, Mr. Auerbach shall
resign his Chairmanship of the Board of Directors and any or
all of the officer positions with the Company and its
subsidiaries. Any such resignations, however, shall not
relieve the Company of its obligation to continue to pay Mr.
Auerbach the consulting fee provided for herein through end of
the Term.
(d) The initial the term of this Agreement together with the
extension thereof if the Company shall exercise its option to
extend are hereinafter referred to as the "TERM".
2. SERVICES:
(a) Mr. Auerbach shall provide to the Company the services of a
Chairman of the Board of Directors, a Chief Executive Officer
and a Chief Financial Officer. Mr. Auerbach shall devote such
time to the rendering of such services as is appropriate and
commensurate with the responsibilities of those offices and he
shall perform such services at such times and at such places
as he shall deem necessary and appropriate.
(b) No restrictions will be placed on other activities of Mr.
Auerbach, subject, however, to Section 6(a)(iv), below,
provided that such activities are not competitive with those
of the Company and that they do not interfere with the
fulfillment by Mr. Auerbach of his obligations under this
Agreement.
3. CONSULTING FEE: The Company shall pay Mr. Auerbach a consulting fee
of ten thousand dollars ($10,000) per month. This fee shall be paid
monthly in advance on or about the first business day of each calendar
month during the Term.
4. STOCK OPTION: Effective on the date hereof, the Company is granting
to Mr. Auerbach a ten-year stock option to purchase one hundred
thousand (100,000) shares of the Company's common stock. The option
shall be set forth in the form of the non-qualified stock option
agreement attached as Exhibit A.
5. BUSINESS EXPENSES: Mr. Auerbach shall be reimbursed in accordance
with Company policies for all reasonable business expenses incurred by
him in the performance of his consulting services hereunder,
including, but without limitation thereto, travel from his office
and/or residence to the Company's facilities. Mr. Auerbach's expense
reports will be subject to review on a periodic basis by the Board of
Directors of the Company.
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6. TERMINATION:
(a) Termination By the Company: This Agreement may be terminated
by the Company only pursuant to the following provisions:
i. For Cause, by written notice to Mr. Auerbach and
payment to him of his consulting fees accrued, but
not paid through the date of termination.
ii. Without Cause upon payment to Mr. Auerbach in a lump
sum the consulting fees that would have otherwise
have been paid to him hereunder for the balance of
the Term, but for such termination.
iii. "Cause" shall mean any act or acts by Mr. Auerbach of
dishonesty or fraud or that constitute serious moral
turpitude; or misconduct of a material nature or a
material breach in connection with the performance by
him of his responsibilities hereunder.
iv. Upon ninety (90) days' prior written notice to Mr.
Auerbach if a majority of the directors of the
Company other than Mr. Auerbach determines in good
faith in the exercise of their sole and absolute
discretion that he has failed to devote adequate time
to rendering the services provided for hereunder.
v. Upon the death or permanent disability of Mr.
Auerbach, but only after continued payment of his
consulting fees for a period of three (3) months
after his death or permanent disability.
(b) Termination By Mr. Auerbach: This Agreement may be terminated
by Mr. Auerbach on ninety (90) days' prior written notice to
the Company. The Company may deem any such notice given by Mr.
Auerbach as a resignation by him, effective upon the giving of
such notice, of all of the directorships and offices then held
by him in the Company and its subsidiaries, but the Company
shall nevertheless continue to pay to him his consulting fees
during such ninety-day period.
7. NOTICES: All notices required or permitted under this Agreement shall
be in writing and shall be deemed given either (a) when hand delivered
to a party; (b) when deposited with a courier service with instructions
to provide next-business-day delivery and proof of delivery; or (c)
when sent by facsimile transmission as follows:
If to the Company, at: 1001 Santerre Drive
Grand Prairie, Texas 75050
Attention: General Counsel
Facsimile No.: (214) 660-4465
with a copy to Robert M. Davies
434 North Street
Greenwich, Connecticut 06830
Facsimile No.: (203) 625-9841
If to Mr. Auerbach at: 108 Barnes Road
Stamford, Connecticut 06902
Facsimile No.: (203) 968-2718
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or to such other address of a party as that party shall notify the
other party in the manner provided herein.
8. PRORATION: To the extent that Mr. Auerbach's consulting fees need
to be prorated for a period of less than a full calendar month, his
consulting fees shall be deemed earned on a daily basis and shall be
pro rated based on a 365-day year.
9. ENTIRE AGREEMENT ETC.
(a) This Agreement together with Exhibit A hereto contains the
entire understanding of the parties; shall not be amended
except by written agreement of the parties signed by each
of them; and shall be binding upon and inure to the benefit
of the parties and their successors, personal
representatives and assigns.
(b) The words "herein", "hereof", "hereunder", "hereby",
"herewith" and words of similar import when used in this
Agreement shall be construed to refer to this Agreement as
a whole.
(c) No waiver of any term or condition contained herein shall
be binding upon the parties unless made in writing and
signed by the party to be bound thereby.
(d) The captions of the paragraphs herein are for convenience
only and shall not be used to construe or interpret this
Agreement.
In Witness Whereof, the parties have executed and delivered this Agreement as
of the date first set forth above.
OAKHURST COMPANY, INC.
By: /s/ ROBERT M. DAVIES /s/ MARK AUERBACH
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Robert M. Davies Mark Auerbach
Chairman, Compensation Committee
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OAKHURST COMPANY, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
Grantee: MARK AUERBACH
Grant Date: DECEMBER 19, 1995
Option Shares: 100,000
Date All Shares are Exercisable: DECEMBER 19, 1996
Last Day to Exercise Option: DECEMBER 19, 2006
This Option Agreement dated as of the Grant Date set forth above is made
between Oakhurst Company, Inc. and you, MARK AUERBACH, and evidences the
Company's grant of a non-qualified stock option (the "Option") to purchase the
number of Option Shares of the Company's Common Stock, $0.01 par value, per
share, set forth above at the per-share option prices set forth below pursuant
to the terms and conditions of this Option Agreement.
This Option has been granted pursuant to a Consulting Agreement dated December
19, 1995 between you and the Company (the "Consulting Agreement").
1. Exercisability and Option Exercise Price.
(a) The Option Shares shall become exercisable in two (2) equal
installments, as follows:
i. 50,000 shares from and after the Grant Date at a
per-share option exercise price of one dollar and
twenty-five cents ($1.25); and
ii. 50,000 shares from and after December 19, 1996 at a
per-share option exercise price of two dollars
($2.00).
(b) provided however, that if prior to December 19, 1996 --
i. the Company terminates the Consulting Agreement for
Cause (as defined and as provided for therein);
ii. the Company gives you notice of termination of the
Consulting Agreement pursuant to Section 6(a)(iv)
thereof; or
iii. you give the Company notice of termination of the
Consulting Agreement pursuant to Section 6(b)
thereof;
then the second installment of 50,000 shares shall
not become exercisable hereunder.
(c) Except as otherwise provided herein, you may purchase any one
or more of the Option Shares that become exercisable at a
given date from that date through and including the Last Day
to Exercise Option, set forth above.
2. Exercises. For an exercise to be effective, the Company must receive
from you:
(a) A written notice directed to the Secretary of the Company,
signed by you stating the Option Grant Date and the number of
whole Option Shares you wish to purchase; and
(b) Payment for the Option Shares either (a) by cashier's or
certified check; or (b) with the consent of the Stock Plans
Committee of the Board of Directors, by the transfer to the
Company of Company common stock having a fair market value
equal to the purchase price of the Option Shares being
purchased, all according to the rules and regulations of such
Committee.
3. Issuance of Option Shares.
(a) You will have no rights as a shareholder of the Company with
respect to any Option Shares purchased under this Option until
a certificate representing such shares has been issued and
delivered to you.
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(b) The Company will not be obligated to deliver a certificate for
any Option Shares to you unless --
i. Provision acceptable to the Company has been made for
the payment of any federal, state and local taxes
that are due or that are required to be withheld by
the Company because of the purchase of the Option
Shares; and
ii. There has been compliance with all federal and state
laws and regulations that the Company deems
applicable, and all other legal matters in connection
with the issuance and delivery of the Option Shares
have been approved by the Company's counsel.
4. Non-Transferability. Except as expressly otherwise provided in the
Plan, this Option is exercisable only by you during your lifetime. In
addition, this Option may not be assigned or transferred except by
will or according to the laws of descent and distribution in the
absence of a will.
5. The 1994 Omnibus Stock Plan.
(a) A copy of the Company's 1994 Omnibus Stock Plan (the "Plan")
is furnished to you with this Agreement. If an amendment to
the Plan that has been adopted by the Board of Directors to
increase the number of shares that may be issued under the
Plan from 350,000 shares to 500,000 shares is approved by the
stockholders of the Company, this option shall relate to
shares issuable under the Plan.
(b) If such amendment is not so approved, this Option shall not
relate to any shares issuable under the Plan, but shall
instead relate to other authorized but unissued shares of the
Corporation's common stock.
(c) In the case of any ambiguity in, or any conflict between or
among, the terms of the Consulting Agreement, this Option
Agreement and, to the extent applicable, the Plan, the
provisions of those documents shall take precedence in the
following, descending order: the Consulting Agreement, this
Option Agreement and the Plan.
6. Adjustments. The number and kind of shares issuable under this Option
Agreement and the per-share option prices will be adjusted to account
for reorganizations, mergers, recapitalization, or the like in the
manner and to the extent provided for in Paragraph 13 of the Plan,
irrespective of whether the Option Shares are issuable under the Plan
or not.
In Witness Whereof, the parties have executed this Option Agreement as of the
Grant Date.
OAKHURST COMPANY, INC. GRANTEE
BY: /s/ ROBERT M. DAVIES /s/ MARK AUERBACH
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Robert M. Davies Mark Auerbach
Chairman, Compensation Committee