Exhibit
10.3
PROFESSIONAL SERVICES
AGREEMENT
WHEREAS, the Company has entered into that
certain Securities Purchase Agreement, dated as of the date hereof,
by and between the Company and Coffee Holdings LLC, a Delaware
limited liability company (“ Holdings ”),
pursuant to which Holdings has acquired notes and common stock of
the Company and other rights with respect thereto (the “
Investment ”);
WHEREAS, in connection with the Investment,
Falconhead has provided and will continue to provide financial and
management consulting services and the Company has received, and
desires to continue to receive, such services and to obtain the
benefit of the experience of Falconhead in business and financial
management generally and its knowledge of the Company and its
financial affairs; and
WHEREAS, Falconhead has provided and is willing
to provide financial and management consulting services to the
Company for the compensation arrangements set forth in this
Agreement.
NOW, THEREFORE, in consideration of the
foregoing premises and the respective agreements hereinafter set
forth and the mutual benefits to be derived herefrom, Falconhead
and the Company hereby agree as follows:
1.
Engagement . The Company hereby engages
Falconhead as a financial and management consultant, and Falconhead
hereby agrees to provide financial and management consulting
services to the Company, all on the terms and subject to the
conditions set forth herein.
2.
Services of Falconhead . Falconhead hereby agrees
during the term of this engagement to consult with the board of
directors of the Company (the “ Board of Directors
”) and management of the Company on such business and
financial matters as may be reasonably requested from time to time
by the Board of Directors or the Company’s management team,
in each case with reasonable advance notice. Such
consultation services shall primarily include assisting the Company
in analyzing its operations and historical performance and
assisting the Company with respect to its corporate strategy and
any future acquisitions, divestitures, financings or other similar
transactions. The Company understands and agrees that if
Falconhead is asked to furnish the Company a financial opinion
letter or act for the Company in any other formal capacity, such
further action shall be at the sole option of Falconhead and may be
subject to a separate agreement containing provisions and terms to
be mutually agreed upon.
3.
Standard of Performance . Falconhead shall devote
such time and efforts to provide the consultation services
hereunder as it deems necessary or appropriate (including by making
the management professionals employed or engaged by it available in
connection therewith); provided , however , that no
minimum number of hours shall be required to be devoted by
Falconhead (or any such management professionals) on a weekly,
monthly, annual or other basis. Falconhead does not make
any representations or warranties, express or implied, in respect
of the consultation services provided hereunder and in no event
shall Falconhead or any of its affiliates or any of their
respective directors, managers, partners, controlling persons
(within the meaning of Section 15 of the Securities Act of 1933, as
amended, or Section 20(a) of the Securities Exchange Act of 1934,
as amended), if any, officers, employees, consultants, advisors or
agents (collectively, the “ Falconhead Parties
”) be liable to the Company for any act, alleged act,
omission or alleged omission or any loss, liability, damage or
expense arising out of or in connection with the performance of
services contemplated by this Agreement, except to the extent the
same is determined by a court of competent jurisdiction by final
and non-appealable judgment to have rsulted primarily from the
gross negligence or willful misconduct of Falconhead.
4.
Fees . In consideration of the consulting
services provided by Falconhead prior to the date hereof in
connection with the Investment, the Company agrees to pay to
Falconhead upon execution of this Agreement a one-time transaction
fee in an amount equal to $500,000. In consideration of
the consulting services to be provided by Falconhead after the date
hereof, the Company shall pay to Falconhead an annual management
fee equal to $100,000, payable in advance in equal quarterly
installments on each January 1, April 1, July 1 and October 1
during the term of this Agreement (with $25,000 payable to
Falconhead upon execution of this Agreement with respect to the
period between the date hereof and June 30, 2009).
5.
Expenses . In addition to the fees payable
hereunder, the Company shall promptly, but in no event less than
thirty (30) days following presentment, reimburse Falconhead for
such reasonable travel expenses and other reasonable out-of-pocket
fees and expenses (including reasonable attorneys fees and
expenses) as may be incurred by any Falconhead Party in connection
with the rendering of services hereunder (including fees and
expenses incurred in attending any Company or industry related
meetings), provided that Falconhead shall obtain the
Company’s prior approval before incurring any expenses in
excess of $2,500 or $10,000 individually or in the aggregate,
respectively.
6.
Payments . All payments or reimbursements to be
made to Falconhead pursuant to this Agreement will be paid by wire
transfer of immediately available funds to account(s) specified by
Falconhead in writing to the Company.
7.
Term . This Agreement will continue from the date
hereof until March 31, 2014. No termination of this
Agreement, whether pursuant to this paragraph or otherwise, shall
affect the Company’s obligations with respect to the fees,
costs and expenses due to or incurred by Falconhead in rendering
services hereunder and not paid or reimbursed by the Company as of
the effective date of such termination or with respect to any fees
due to Falconhead as of the date of termination. In
addition, if this Agreement shall be terminated by the Company
prior to the end of the term, the Company shall also be required to
pay to Falconhead all fees payable under Section 4 through the
remainder of the term in a lump sum payment on the date of such
termination.
(a) The
Company shall indemnify and hold harmless each Falconhead Party
(collectively referred to as “ Indemnified Persons
” and individually as an “ Indemnified Person
”) from and against any and all claims, liabilities, losses,
damages and expenses incurred by any Indemnified Person (including
those arising out of an Indemnified Person’s negligence)
which (A) are related to or arise out of (i) actions
taken or omitted to be taken (including any untrue statements made
or any statements omitted to be made) by the Company or
(ii) actions taken or omitted to be taken by an Indemnified
Person with the Company’s consent or in conformity with any
Company instructions or any actions or omissions by the Company or
(B) are otherwise related to or arise out of
Falconhead’s engagement or its performance of services
hereunder, and will reimburse each Indemnified Person for all costs
and expenses, including fees and disbursements of any Indemnified
Person’s counsel, as they are incurred, in connection with
investigating, preparing for, defending or appealing any action,
formal or informal claim, investigation, inquiry or other
proceeding, whether or not in connection with pending or threatened
litigation, related to, arising out of or in connection with
Falconhead’s engagement or performance of services hereunder,
whether or not any Indemnified Person is named as a party thereto
and whether or not any liability results therefrom. The
Company will not, however, be responsible to any Indemnified Person
for any claims, liabilities, losses, damages or expenses pursuant
to clause (B) of the preceding sentence that to the extent that the
same is determined by a court of competent jurisdiction by final
and non-appealable judgment to have resulted primarily from the
gross negligence or willful misconduct of
Falconhead. The Company further agrees that it will not,
without the prior written consent of Falconhead, settle or
compromise or consent to the entry of any judgment in any pending
or threatened claim, action, suit or
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