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EXHIBIT 10.32: CONSULTING AGREEMENT BETWEEN THE COMPANY AND ROBERT M. WILSON
CONSULTING AGREEMENT AND GENERAL RELEASE
THIS CONSULTING AGREEMENT AND GENERAL RELEASE ("Agreement") is made and
entered into as of January 6, 1997 by and between Robert M. Wilson ("Wilson")
and Children's Wonderland, Inc., a California corporation (the "Company").
RECITALS
A. Wilson is currently an officer (President and Chief Financial Officer),
employee and a member of the Board of Directors of the Company.
B. Wilson and the Company are parties to an Employment Agreement dated as
of June 1, 1995 which provides for the employment of Wilson by the
Company for a term that expires May 31, 1998, subject to earlier
termination as provided therein (the "Employment Agreement").
C. Wilson has resigned as an officer of the Company effective January 6,
1997.
D. Wilson has agreed to resign as an employee of the Company (but not as a
member of the Board of Directors) on the terms set forth in this
Agreement.
E. Wilson and the Company have agreed that Wilson shall serve as a
consultant to the Company on the terms set forth in this Agreement.
F. Wilson has agreed to give the Company and its officers, directors,
employees and agents a general release of liability on the terms set
forth in this Agreement.
AGREEMENT
IN WITNESS WHEREOF, Wilson and the Company have agreed as follows:
1. RESIGNATIONS.
Wilson hereby resigns as an employee of the Company on the Effective
Date (defined in Section 21, below). Wilson does not resign as a member of the
Board of Directors of the Company.
2. PAYMENTS BY THE COMPANY.
On the Effective Date, Wilson shall be paid (a) his accrued salary
through the Effective Date (based on an annual salary rate of $98,000 per year,
less necessary withholding and payroll taxes), (b) his accrued unused vacation
pay, and (c) his outstanding unreimbursed out-of-pocket expenses incurred in
connection with the Company's business.
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3. BONUS PAY
Wilson is not entitled to any bonus or incentive compensation that
has not already been paid to him. Nonetheless, as consideration for Wilson's
agreements made in this Agreement, including Sections 1, 5, and 6 of this
Agreement, the Company shall pay to Wilson a bonus for his service as an
employee and officer in the amount of $25,000, as follows: (a) $5,000 shall be
paid on the date the parties execute this Agreement and (b) the balance of
$20,000 shall be paid within 45 days thereafter.
4. COBRA
Wilson is eligible to elect continuation of medical and related
insurance coverage for himself and his dependents under the Comprehensive
Omnibus Budget Reconciliation Act (COBRA) at Wilson's expense in accordance with
its terms.
5. GENERAL RELEASE.
As a material provision of this Agreement, Wilson for himself, his
heirs and assigns, hereby releases and forever discharges the Company and each
and all of the Company's owners, stockholders, predecessors, successors,
assigns, agents, directors, officers, employees, representatives and attorneys,
from any and all claims, liabilities, demands, rights and interests of
whatsoever kind and character, known or unknown, including, but not limited to,
those arising or attributable from Wilson's employment with the Company to the
date of this Agreement and the termination of that employment, including claims
for breach of contract, breach of implied covenant, breach of oral or written
promise, wrongful termination, race, aged, sex, national origin, physical
handicap, medical condition or other discrimination, including any claims under
the federal Age Discrimination in Employment Act of 1967 or the Americans With
Disabilities Act and their state law counterparts.
6. KNOWING AND VOLUNTARY WAIVER.
Wilson expressly waives and relinquishes all rights and benefits
afforded by Section 1542 of the Civil Code of the State of California (as well
as any similar statue under any applicable jurisdiction), and does so
understanding and acknowledging the significance of such specific waiver of
Section 1542. Section 1542 of the Civil Code of the State of California states
as follows:
"A general release does not extend to claims which the creditor does
not know or suspect to exist in his favor at the time of executing
the release, which if known by him must have materially affected his
settlement with the debtor."
7. TERMINATION OF THE EMPLOYMENT AGREEMENT.
This Agreement supersedes and terminates any and all rights and
claims he may or later have under the Employment Agreement which is hereby
terminated, with the exception of Paragraph 9 thereof.
Paragraph 9 reads in full as follows:
"9. INDEMNIFICATION BY EMPLOYER. Employer shall, to the maximum
extent permitted by law, indemnify and hold Executive [Wilson]
harmless against expenses, including reasonable attorney's fees
judgments, fines, settlements, and other amounts actually and
reasonably incurred in connection with any proceeding arising by
reason of Executive's employment by Employer. Employer shall
advance to Executive any expense incurred in defending any such
proceeding to the maximum extent permitted by law."
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8. CONSULTING ASSIGNMENT
As additional consideration for Wilson's agreements made in this
Agreement, including Sections 1, 5, and 6 of this Agreement, on the Effective
Date, the Company agrees to engage Wilson as a consultant and Wilson agrees to
act as a consultant for the Company.
9. CONSULTING DUTIES.
Wilson's duties as a consultant will be to seek out, analyze and
negotiate acquisitions. Wilson will also carry out other duties as assigned to
him by the President and/or CEO of the Company. Wilson shall have no authority
to enter into any agreement on behalf of the Company.
10. TIME COMMITMENT BY WILSON
Wilson will devote the time necessary to carry out his duties as a
consultant to the Company. Subject to this commitment, Wilson may engage in
other business pursuits.
11. TERM OF CONSULTING ASSIGNMENT.
The term of Wilson's consulting assignment shall be two years from
the Effective Date, subject to earlier termination by the Company or Wilson, for
any reason whatsoever, with or without cause, on or after the first twelve-month
anniversary of the Effective Date on three month's written notice to the other
given on or after the first nine-month anniversary of the Effective Date.
12. CONSULTING FEE
For his services as a consultant, the Company shall pay Wilson a
consulting fee of $9,000 per month. The consulting fee shall be payable in
advance on the first day of the month and shall be delinquent on the 10th day of
the month. Wilson will invoice the Company for the consulting fee due him. The
consulting fee for any partial month shall be prorated.
13. FINDER'S FEE
In addition to his consulting fee, the Company shall pay Wilson a
finder's fee for business acquisitions completed by the Company during the term
of the Consulting Agreement for those businesses that Wilson identifies and
(with the agreement of the Company) negotiates with on behalf of the Company, or
business acquisitions identified by others but which the Company assigns to
Wilson to analyze and negotiate. Wilson is not entitled to a finder's fee for
the Company's acquisition of Pacifica Manor & Senior Home Care .
14. CALCULATION OF FINDER'S FEE
The finder's fee under Section 13 shall equal 2% of the first
$500,000 of consideration (cash, stock, notes, etc.) paid by the Company for the
net assets of the acquired business (assets acquired less liabilities assumed)
and 1% of any excess over $500,000. If Wilson identifies the acquired business
himself and no other broker or finder is involved on behalf of the Company, the
finder's fee under Section 13 shall equal 2% of the first $1,000,000 of
consideration (cash, stock, notes, etc.) paid by the Company for the net assets
of the acquired business (assets acquired less liabilities assumed) and 1% of
any excess over $1,000,000. No fee shall be paid with respect to the acquisition
of the Company by a third party.
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15. STOCK OPTION
The Incentive Stock Option Agreement dated June 1, 1995 between the
Company and Wilson shall remain in effect and may be exercised by Wilson until
the second anniversary of the Effective Date, when the stock option shall
expire. The stock option shall be exercisable whether or not this Agreement has
terminated early pursuant to Section 11.
16. DISCLOSURE OF CONFIDENTIAL INFORMATION AND TRADE SECRETS PROHIBITED.
In the course of his employment with the Company and during the
course of consulting for the Company, Wilson has had and will have access to
confidential information and trade secrets relating to the Company's business.
Confidential information includes but is not limited to inventions, processes,
designs, improvements, programs, specifications, techniques, data relating to
creation, manufacture and marketing of any service or service concept, customer
and prospective customer names and addresses, sales records, vendor names and
addresses, financial data, information concerning possible acquisitions or
business combinations, expansion plans, information provided by third parties
that the Company is required to keep confidential, and any other proprietary
information of the Company (unless such information is lawfully obtainable from
other sources). Except (a) as required in the course of his engagement by the
Company as a consultant and in furtherance of the Company's best interests, (b)
is required by applicable law, (c) authorized by the Company, Wilson will not,
without the Company's prior written consent, either during the term of this
Agreement or for five years after termination of this Agreement, directly or
indirectly disclose to any person or entity any such confidential information or
trade secrets.
17. ARBITRATION.
All claims of any type between Wilson and the Company (including any
claims against any of the Company's owners, stockholders, predecessors,
successors, assigns, agents, directors, officers, employees, representatives and
attorneys) including but not limited to any claims arising out of or in any way
related to this Agreement or any successor agreement (written, oral or implied)
and claims concerning its interpretation, validity, enforceability or breach,
shall be settled and finally determined by one arbitrator in Los Angles County,
California in accordance with the Model Employee Dispute Procedures of the
American Arbitration Association and judgment by the arbitrator may be entered
in any court having jurisdiction thereof. The agreement to arbitrate includes
any claims for breach of contract, wrongful termination, discrimination of any
type and all other claims of any type to the maximum extent permissible.
18. CALIFORNIA LAW.
This Agreement is to be interpreted pursuant to California
substantive law.
19. INVALID PROVISIONS.
Should any portion of this Agreement for any reason be declared
invalid, the validity and binding effect of any remaining portion shall not be
affected, and the remaining portion of this Agreement shall remain in full force
and effect as if this Agreement had been executed with the invalid provision
eliminated.
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20. ENTIRE AGREEMENT.
This Agreement contains the entire agreement between the parties with
respect to the legal relationship of the parties and supersedes all prior and
contemporaneous agreements, representations and understanding of the parties. No
modification, amendment or waiver of any of the provisions of this Agreement
shall be effective unless in writing and signed by both parties.
21. WAITING PERIOD AND RIGHT OF REVOCATION.
(a) WILSON ACKNOWLEDGES THAT HE IS HEREBY ADVISED THAT HE HAS THE RIGHT
TO CONSIDER THE AGREEMENT FOR TWENTY-ONE DAYS BEFORE SIGNING IT AND THAT IF HE
SIGNS THIS AGREEMENT PRIOR TO THE EXPIRATION OF TWENTY-ONE DAYS, HE IS WAIVING
THIS RIGHT FREELY AND VOLUNTARILY.
(b) HE ALSO ACKNOWLEDGES THAT HE IS HEREBY ADVISED OF HIS RIGHT TO
REVOKE THIS AGREEMENT FOR A PERIOD OF SEVEN DAYS FOLLOWING THE EXECUTION OF THIS
AGREEMENT AND THAT IT SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE
REVOCATION PERIOD HAS EXPIRED. THE "EFFECTIVE DATE" IS THE DATE THE REVOCATION
PERIOD EXPIRES. TO REVOKE THIS AGREEMENT, HE MUST NOTIFY THE COMPANY WITHIN
SEVEN DAYS OF EXECUTING IT.
(c) IF WILSON REVOKES THIS AGREEMENT, HE WILL RETURN THE INITIAL BONUS
PAYMENT PROVIDED FOR IN SECTION 3.
22. ATTORNEY ADVICE.
WILSON ACKNOWLEDGES THAT HE IS AWARE OF HIS RIGHT TO CONSULT AN
ATTORNEY, THAT HE HAS BEEN ADVISED TO CONSULT WITH AN ATTORNEY PRIOR TO
EXECUTING THIS AGREEMENT, AND THAT HE HAS HAD THE OPPORTUNITY TO CONSULT WITH AN
ATTORNEY.
23. UNDERSTANDING OF AGREEMENT
Wilson states that he has carefully read this Agreement, that he
fully understands its final and binding effect, that the only promises made to
him to sign this Agreement are those stated above, and he is signing this
Agreement voluntarily.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the
dates set forth below as of the date first above written.
CHILDREN'S WONDERLAND, INC
a California Corporation
By:
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An Authorized Officer Robert M. Wilson
Date of Execution: __________, 1997 Date of Execution: _________, 1997
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