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EXHIBIT 10.19
TATUM CFO PARTNERS, LLP
INTERIM EXECUTIVE SERVICES AGREEMENT
June 24, 2005
Joseph McGuire, CEO
Tweeter Home Entertainment Group
40 Pequot Way
Canton, MA 02021
Dear Joe:
Tatum CFO Partners, LLP ("Tatum")
understands that Tweeter Home Entertainment
Group ("the Company") desires to engage a
partner of Tatum to serve as interim
chief financial officer. This Interim
Executive Services Agreement sets forth
the conditions under which such services
will be provided.
Services; Fees
Commencing on July 6, 2005, Tatum will make
available to the Company Paul
Burmeister (the "Tatum Partner"), who will
serve as chief financial officer of
the Company for a term of three months, or
such longer term as mutually agreed
to by the Company and the Tatum Partner.
The Tatum Partner will become an
employee and, if applicable, a duly elected
or appointed officer of the Company,
and subject to the supervision and
direction of the CEO of the Company, the
board of directors of the Company, or both.
Tatum will have no control or
supervision over the Tatum Partner.
The Company will pay the Tatum Partner
directly a salary of $23,920.00 per
month, with payments to be made in the
normal course of the Company's
exempt-employee payroll. In addition, the
Company will pay directly to Tatum a
fee of $5,980.00 per month as compensation
for resources provided. The Company
will pay Tatum the monthly fees one month
in advance, with the first payment due
on July 6, 2005. The second payment and
every payment thereafter will be paid in
advance before each month-end related to
the following month.
Within the first six weeks of the Tatum
Partner's engagement by the Company, the
Company and the Tatum Partner will agree on
targets and deliverables to be used
as the basis for incentive compensation. If
the agreed-upon targets and
deliverables are achieved, at the end of
the engagement the Tatum Partner will
receive incentive compensation equal to 25%
of salary paid during the
engagement, or such lesser amount as the
Tatum Partner and the Company may agree
to. In addition, Tatum shall receive a fee
equal to 25% of the incentive
compensation paid to the Tatum Partner,
payable within ten days of the end of
the engagement.
The Company will have no obligation to
provide the Tatum Partner any health or
major medical benefits. In lieu of the
Tatum Partner participating in the
Company-sponsored employee medical
insurance benefit plan, the Tatum Partner
will remain on his or her current medical
plan. The Company will reimburse the
Tatum Partner for amounts paid by the Tatum
Partner for medical
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insurance for himself and his family upon
presentation of reasonable
documentation of premiums paid by the Tatum
Partner, provided that such
reimbursement will not exceed the amount
paid by the Company for comparable
benefits provided to other senior managers.
In accordance with the U.S. federal
tax law, such amount will not be considered
reportable W-2 income, but instead
non-taxable benefits expense
reimbursement.
As an employee, the Tatum Partner will be
eligible for any Company employee
retirement and/or 401(k) plan and for
vacation and holidays consistent with the
Company's policy as it applies to senior
management, and the Tatum Partner will
be exempt from any delay periods otherwise
required for eligibility.
The Company will reimburse the Tatum
Partner directly for out-of-pocket expenses
incurred by the Tatum Partner in providing
services hereunder to the same extent
that the Company is responsible for such
expenses of senior managers of the
Company.
The Company agrees to pay Tatum and to
maintain a security deposit of $10,000.00
for the Company's future payment
obligations to both Tatum and the Tatum Partner
under this agreement (the "Deposit"). The
security deposit must be received by
Tatum before the Tatum Partner's employment
commences. If the Company breaches
this agreement and fails to cure such
breach as provided in this agreement,
Tatum will be entitled to apply the Deposit
to its damages resulting from such
breach. Upon termination or expiration of
this agreement, Tatum will return to
the Company the balance of the Deposit
remaining after application of any
amounts to unfulfilled payment obligations
of the Company to Tatum or the Tatum
Partner as provided for in this
agreement.
Hiring Tatum Partner Outside of
Agreement
During the twelve (12)-month period
following termination or expiration of this
agreement, other than in connection with
another Tatum agreement, the Company
will not employ the Tatum Partner, or
engage the Tatum Partner as an independent
contractor, to render services of
substantially the same nature as those to be
performed by the Tatum Partner as
contemplated by this agreement. The parties
recognize and agree that a breach by the
Company of this provision would result
in the loss to Tatum of the Tatum Partner's
valuable expertise and revenue
potential and that such injury will be
impossible or very difficult to
ascertain. Therefore, in the event this
provision is breached, Tatum will be
entitled to receive as liquidated damages
an amount equal to twenty-five percent
(25%) of the Tatum Partner's Annualized
Compensation (as defined below), which
amount the parties agree is reasonably
proportionate to the probable loss to
Tatum and is not intended as a penalty. If,
however, a court or arbitrator, as
applicable, determines that liquidated
damages are not appropriate for such
breach, Tatum will have the right to seek
actual damages. The amount will be due
and payable to Tatum upon written demand to
the Company. For this purpose,
"Annualized Compensation" will mean monthly
Salary equivalent to what the Tatum
Partner would receive on a full-time basis
multiplied by twelve (12), plus the
maximum amount of any bonus for which the
Tatum Partner was eligible with
respect to the then current bonus year.
Term & Termina
