Exhibit 10.1
MANAGEMENT
AGREEMENT
This MANAGEMENT AGREEMENT (the
“Agreement”) dated as of November 19, 2004 is made by
and between Robotic Vision Systems, Inc. and Auto Image ID, Inc.
(collectively the “Debtors”) and Marotta Gund Budd
& Dzera, LLC (the “Manager”), a New Jersey limited
liability corporation.
RECITALS
WHEREAS, the Debtors have filed petitions for the
commencement of proceedings under chapter 11 of the U.S. Bankruptcy
Code; and
WHEREAS, the Manager has substantial experience and
expertise assisting Debtors in chapter 11 proceedings with the
myriad of financial, operational, legal and other activities
required to effectuate a swift and orderly recapitalization under
chapter 11;
WHEREAS, the Debtors desire to engage Manager to provide
various services to the Debtor in connection with their chapter 11
proceedings, and Manager desires to accept such engagement, all in
accordance with the terms and conditions set forth more fully in
this Agreement.
NOW, THEREFORE, in consideration of
the promises and covenants set forth herein, and for other good a
valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto, intending to be legally
bound hereby, do hereby agree as follows:
1. Engagement. The Debtors
hereby engage the Manager as an independent contractor to the
Debtors, and the Manager hereby accepts such engagement, on the
terms and conditions set forth in this Agreement subject only to
Bankruptcy court approval. The Debtors are hereby acquiring from
the Manager the services of J. Richard Budd III
(“Budd”) and Fred Van Alstyne (“Van
Alstyne”), as well as such additional professionals,
including Stephen Marotta (“Marotta”) that may be
subsequently identified, as set forth below. All compensation for
the services and actions of Budd, Van Alstyne, and the
Manager’s other professionals, including Marotta that may
perform services on the Debtors’ behalf under this Agreement,
will be paid by the Debtors directly to the Manager.
2. Duties.
( a ) The Debtors represent
to the Manager that the Debtors’ Boards of Directors
(individually and collectively, the “Board”) have duly
approved the retention of the Manager and approved the terms of
this Agreement, including the appointment of Budd as the Chief
Restructuring Officer (“CRO”) of the Debtors and Van
Alstyne as the Chief Financial Officer. The Manager will assign (i)
Budd to serve as CRO of the Debtors (ii) Van Alstyne to serve as
CFO of the Debtors and (iii) Marotta to act in various managerial
capacities as may be
necessary to support Budd and Van Alstyne in the
performance of duties as CRO and CFO, and (iii) such additional
personnel of the Manager to act in various managerial capacities as
may be necessary to carry out the services required of the Manager
under this Agreement.
( b ) Subject to any
delegation of authority issued by Pat V. Costa (the
“CEO”) Chief Executive Officer of the debtors, Budd (in
his role as Chief Restructuring Officer) and Van Alstyne (in his
role as Chief Financial Officer) shall be authorized to make
decisions with respect to delegated aspects of the management and
operation of the Debtors’ business including, without
limitation, organization, human resources, marketing, sales,
logistics, finance, administration, and oversight of the Bankruptcy
process (including, but not limited to, Bankruptcy court reporting
requirements, filing of Statement of Affairs, Schedule of Assets
and Liabilities, a Plan of Reorganization, Disclosure Statement,
claims management, managing outside professionals and such other
areas as they may identify), in such manner as Budd and Van Alstyne
deems necessary or appropriate consistent with the business
judgment rule, subject only to prior approvals and governance by
the CEO and the Board in accordance with the Debtors’
charter, bylaws and legal obligations, and the Bankruptcy court.
The Manager, as well as any individual thereof, including without
limitation Budd, Van Alstyne, and Marotta, shall report to and
serve at the pleasure of the CEO, who may suspend or terminate the
Manager’s or any individual’s relationship with the
Debtors for any reason.
( c ) The Manager shall cause
Budd and Van Alstyne to devote substantial business time to the
performance of services for the Debtors hereunder on behalf of the
Manager, and shall cause other professionals of the Manager,
including Marotta to devote such time as may be necessary and
appropriate for the performance of Manager’s obligations
under this Agreement. However, there are no minimum hourly, daily
or weekly time requirements.
( d ) In undertaking to
provide the services set forth herein, the Manager does not
guarantee or otherwise provide any assurances that it will succeed
in improving the Debtors’ operational and financial health
and stability or that there will be a successful reorganization
under the Chapter 11 proceeding. The Debtors’ obligation to
pay the Manager’s compensation and reimbursement of expenses
(as specified below under Section 4(a) and Section 4(b),
respectively) shall not be conditioned upon any particular results
being achieved by the Manager but only final Bankruptcy court
approval at the conclusion of this engagement.
( e ) In view of their
current liquidity constraints as well as other pressures caused by
their financial condition, the Debtors acknowledge that Budd and
Van Alstyne, and the Manager’s other professionals, including
Marotta, may be required to make decisions quickly with respect to
extraordinary measures. Consequently, the depth of their analysis
of the information on which their decisions will be based may be
limited in some respects due to the availability of information,
time constraints and other factors. Moreover, each of Budd and Van
Alstyne, and the Manager’s other professionals, including
Marotta shall be entitled, in performing their duties hereunder on
behalf of the Manager, to rely on information disclosed or supplied
to them by the Debtors’ officers, employees and
representatives without verification or warranty of accuracy or
validity, provided that any such reliance is premised on a good
faith belief as to the accuracy or validity of such information
after making such inquiries as are appropriate under the
circumstances.
( f ) Budd and Van Alstyne,
and the Manager’s other professionals, including Marotta,
shall keep the Debtors’ CEO, the Board and such other
corporate officers of the Debtors as may be appropriate under the
circumstances, fully apprised of their findings, plans and
activities. The Company understands that Budd and Van Alstyne will
communicate with the Debtors’ creditors and their respective
professionals as to the status of operations and the Debtors’
restructuring plans.
3. Term. The term of the Manager’s
engagement hereunder (the “Term”) shall commence on the
date the Manager’s application for retention is approved,
nunc pro tunc to the date of filing for
protection under Chapter 11, if such approval is granted by the
Bank
