EXHIBIT 10.2

 

CONSULTING SERVICES AGREEMENT

 

THIS CONSULTING SERVICES AGREEMENT (this “Agreement”) is entered into as of the
30th day of January, 2004, by and between Global Power Equipment Group Inc., a
Delaware corporation (the “Company”), and Gary J. Obermiller, an individual
(“Consultant”).

 

WHEREAS, the Company and its subsidiaries are engaged in the businesses of
designing, engineering and fabricating equipment for gas turbine power plants
and power-related equipment for industrial operations and providing related
value-added services including engineering, retrofit and upgrade, and
maintenance and repair, such businesses being conducted on a worldwide basis;
and

 

WHEREAS, Consultant has significant experience and expertise in operational,
management and other matters related to the Company and its subsidiaries on
account of his service as the President and Chief Operating Officer of the
Company and his prior service as Senior Vice President of the Company and
President of Deltak, LLC, a wholly owned subsidiary of the Company; and

 

WHEREAS, pursuant to the Separation Agreement and Release, dated January 30,
2004, between the Company and Consultant (the “Separation Agreement”),
Consultant has agreed to retire from the Company effective January 31, 2004; and

 

WHEREAS, the Company and its subsidiaries wish to obtain certain consulting
services from Consultant in connection with their business activities after such
retirement and Consultant is willing to provide such services to the Company and
its subsidiaries on the terms specified herein;

 

NOW, THEREFORE, for and in consideration of the premises and the mutual promises
and covenants hereinafter set forth, the parties hereto agree as follows:

 

1. Services. The services to be provided by Consultant will consist of
assistance in connection with operational and management matters related to the
Company and its subsidiaries normally performed by the President and COO of
Global or the President of Deltak (“Services”). All Services will be rendered at
the request and under the general direction of the Company’s Chief Executive
Officer and other executives of the Company. The Company will provide Consultant
such information about the business activities of the Company and its
subsidiaries as Consultant may reasonably require in order to carry out the
Services.

 

2. Standard of Performance. All Services will be performed by Consultant with a
level of skill and care generally exercised by employees or other consultants
engaged in performing the same or similar services. In performing the Services,
Consultant will comply fully with all applicable laws.

 

3. Relationship. The relationship between the Company and Consultant will be
that of independent contractors and Consultant will not be or be deemed to be a
partner, agent or

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employee of the Company or any of its subsidiaries. Consultant will not be
eligible to participate in any employee pension, insurance, medical, retirement
or other employee benefit plan of the Company or any of its subsidiaries on
account of the provision of Services pursuant to this Agreement. Consultant
shall have no authority to act as an agent of the Company, except on authority
specifically so delegated, and Consultant shall not represent to the contrary to
any person. Consultant shall only consult, render advice and perform such tasks
as Consultant determines are necessary to achieve the results specified by the
Company. Consultant shall not direct the work of any employee of the Company, or
make any management decisions, or undertake to commit the Company to any course
of action in relation to third persons. Although the Company may specify the
results to be achieved by Consultant and may control and direct him in that
regard, the Company shall not control or direct the Consultant as to the details
or means by which such results are accomplished.

 

4. Term. This Agreement will become effective on February 1, 2004 and, except as
provided below, will continue until January 31, 2005; provided, however, that
this Agreement shall terminate and be of no force or effect if Consultant
exercises any right of rescission or revocation under the Separation Agreement
or the Release contemplated thereby or if Consultant fails to execute and
deliver such Release to the Company on January 30, 2004. This Agreement and
Consultant’s retention hereunder may be terminated by the Company for “Cause”
(as defined below). In the event of a termination by the Company for Cause,
neither the Company nor the Consultant shall have any further obligations
hereunder, except as set forth in Sections 10, 11, 12 and 13 hereof. For
purposes of this Agreement, “Cause” shall mean Consultant’s (i) gross
malfeasance or gross misfeasance in the performance of his services to the
Company, (ii) continued failure to perform the services to the Company
reasonably requested of him hereunder, other than due to Consultant’s death or
physical or mental incapacity, (iii) engagement in any felonious acts or other
acts showing dishonesty or moral turpitude or (iv) breach of the covenants set
forth in Sections 10, 11 or 12 hereof.

 

5. Availability. Upon reasonable advance notice, Consultant will be available to
perform Services for a cumulative period of up to 40 hours per week and may,
upon mutual agreement, provide Services in excess of 40 hours per week. For
purposes of Paragraph 4(ii) of this Agreement, Consultant’s refusal to provide
services in excess of 40 hours per week shall not be deemed a failure to perform
services to the Company reasonably requested of him.

 

6. Compensation. The Company will pay Consultant an aggregate fee of $415,565.00
in consideration of Consultant’s performance of the Services. Such fee will be
payable on the last day of each calendar month in 12 equal installments
beginning on February 28, 2004; provided, however, that, at the Company’s
discretion, such payment may be accelerated based upon substantial completion of
assignments, satisfactory performance and other factors, but in no event shall
the aggregate amount of payment be less than $415,565.00. In the event of
Consultant’s death during the term of this Agreement, the unpaid portion of such
fee shall be paid to Consultant’s estate in accordance with the above payment
schedule. In the event of Consultant’s inability to perform the Services during
the term of this Agreement on account of disability or incapacity, Consultant
shall not be in breach of this Agreement on account thereof and the Company
shall continue to make the payments to Consultant called for by this Section 6.

 

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7. Expenses and Facilities. The Company will reimburse Consultant for all
reasonable business expenses paid or incurred by Consultant directly in
connection with the performance of the Services. In addition, while this
Agreement remains in effect and during the time that the Company has requested
that Consultant perform any Services, the Company will make available to
Consultant without charge appropriate office space, office equipment and
clerical assistance for use in connection with Consultant’s performance of such
Services. During the term of this Agreement, Consultant will retain possession
of the portable computer obtained by Consultant from the Company. Upon the
expiration of the term of this Agreement, Consultant will retain possession of
such portable computer after removal therefrom of all property and software
owned or licensed by the Company, including all Confidential Information (as
hereinafter defined).

 

8. Taxes. Consultant will pay and be fully responsible for all taxes
attributable to the compensation payable to Consultant hereunder, including,
without limitation, income, Social Security and Medicare taxes. To the extent
consistent with applicable law, the Company will not withhold any amounts
payable to Consultant as federal income tax withholding from wages or as
employee contributions under the Federal Insurance Contributions Act or any
other state or federal laws.

 

9. Insurance. While this Agreement remains in effect, Consultant will maintain
in force or cause to be maintained in force with respect to any automobile
operated by Consultant automobile liability insurance with limits of not less
than $100,000 for any one person for bodily injury or death, $300,000 for any
one accident for bodily injury or death and $50,000 for property damage.
Consultant will provide the Company evidence of such insurance upon its request.

 

10. Work Product. Consultant agrees that all inventions, drawings, improvements,
developments, methods, processes, programs, designs and all similar or related
information which relates to the Company’s or any of its subsidiaries’ actual or
anticipated business or research and development or existing or future products
or services and which are conceived, developed, contributed to or made by
Consultant (either solely or jointly with others) during the term of this
Agreement or during his prior employment with the Company (“Work Product”) will
be the sole and exclusive property of the Company or any such subsidiary.
Consultant will promptly disclose such Work Product to the Company and perform
all actions requested by the Company (whether during or after the term of this
Agreement) to establish and confirm such ownership (including, without
limitation, assignments, consents, powers of attorney and other instruments).

 

11. Confidential Information.

 

(a) Consultant acknowledges that:

 

(i) the Work Product, artificial intelligence systems, information, customer
lists, goodwill, observations and data disclosed to, developed by or obtained by
him during the term of this Agreement or during his prior employment with the
Company concerning the business or affairs of the Company or any such subsidiary
(including without limitation the Company’s and its subsidiaries’ technology,
methods of doing

 

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business and supplier and customer information) (collectively, “Confidential
Information”) are highly confidential and uniquely valuable to the Company and
its subsidiaries;

 

(ii) such Confidential Information is and will continue to be the property of
the Company or any such subsidiary;

 

(iii) the Company and each of its subsidiaries has a proprietary interest in
their respective Confidential Information, including without limitation the
identity of their respective customers and suppliers, solicited customers,
customer and supplier lists;

 

(iv) the continued success of the Company and its subsidiaries depends in large
part on keeping the Confidential Information from becoming known to competitors
of the Company and its subsidiaries; and

 

(v) the Company and its subsidiaries will be irreparably harmed by disclosure of
any Confidential Information.

 

(b) Therefore, Consultant agrees:

 

(i) That, during the term of this Agreement and for all times thereafter, except
as required by law or court order, he will not directly or indirectly disclose
to any unauthorized person or use for his own account any Confidential
Information without the prior written consent of the Company, unless and to the
extent that the aforementioned matters become generally known to and available
for use by the public other than as a result of Consultant’s acts or omissions
to act;

 

(ii) To use his best efforts and diligence to safeguard the Confidential
Information and to protect it against disclosure, misuse, espionage, loss or
theft;

 

(iii) That upon the expiration of the term of this Agreement or at any other
time the Company may request, for whatever reason, Consultant will deliver (and
in the event of Consultant’s death or incapacity, his representative will
deliver) to the Company all computer equipment or backup files of or relating to
the Company and its subsidiaries, all memoranda, correspondence, customer data,
notes, plans, records, reports, manuals, photographs, computer tapes and
software and other documents and data (and copies thereof) relating to the
Confidential Information, the Work Product or the business of the Company or any
of its subsidiaries which he may then possess or have under his control;
provided that after removal by the Company of Confidential Information, if any,
Consultant’s portable computer shall be returned to Consultant pursuant to
Paragraph 7 of this Agreement. If the Company requests, Consultant (or his
representative) agrees to provide written confirmation that Consultant has
returned all such materials to the Company or one of its subsidiaries; and

 

(iv) That upon the expiration of the term of this Agreement or at any other time
the Company may request, for whatever reason, Consultant will assign all rights,
title and interest in the Confidential Information, the Work Product, all
computer equipment or backup files of or relating to the Company or any of its
subsidiaries, all

 

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memoranda, correspondence, customer data, notes, plans, records, reports,
manuals, photographs, computer tapes and software and other documents and data
(and copies thereof) relating to the Confidential Information, the Work Product
or the business of the Company or any of its subsidiaries which Consultant may
then possess, has under his control, or has ever developed, obtained, or
contributed to during his tenure with the Company.

 

12. Noncompete; Nonsolicitation.

 

(a) Consultant agrees that, during the term of this Agreement (the “Restricted
Period”), he will not directly or indirectly own, operate, manage, control,
participate in, consult with, advise, provide services for, or in any manner
engage in any business (including by himself or in association with any person,
firm, corporate or other business organization or through any other entity) in
competition with the businesses of the Company or any of its subsidiaries as
such businesses exist during the term of this Agreement, within the United
States or any other geographical area in which the Company or any of its
subsidiaries engages in such businesses. Nothing herein will prohibit Consultant
from being a passive owner of not more than 2% of the outstanding stock of a
corporation which is publicly traded, so long as Consultant has no active
participation in the business of such corporation.

 

(b) During the Restricted Period, Consultant will not directly or indirectly
through another entity (i) induce or attempt to induce any employee of the
Company or any of its subsidiaries to leave the employ of the Company or any
such subsidiary, or in any way interfere with the relationship between the
Company or any of its subsidiaries and any employee thereof, including without
limitation, inducing or attempting to induce any union, employee or group of
employees to interfere with the business or operations of the Company or any of
its subsidiaries, (ii) hire any person who was an employee of the Company or any
of its subsidiaries at any time during Consultant’s employment period, or (iii)
induce or attempt to induce any customer, supplier, distributor, franchisee,
licensee or other business relation of the Company or any of its subsidiaries to
cease doing business with the Company or any such subsidiary, or in any way
interfere with the relationship between any such customer, supplier,
distributor, franchisee, licensee or business relation and the Company or any of
its subsidiaries.

 

(c) Consultant agrees that: (i) the covenants set forth in this Section 12 are
reasonable in geographical and temporal scope and in all other respects, (ii)
the Company would not have entered into this Agreement but for the covenants of
Consultant contained herein, and (iii) the covenants contained herein have been
made in order to induce the Company to enter into this Agreement.

 

(d) If, at the time of enforcement of this Section 12, a court shall hold that
the duration, scope or area restrictions stated herein are unreasonable under
circumstances then existing, the parties agree that the maximum duration, scope
or area reasonable under such circumstances will be substituted for the stated
duration, scope or area and that the court will be allowed to revise the
restrictions contained herein to cover the maximum period, scope and area
permitted by law.

 

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13. Remedies. Consultant recognizes and affirms that in the event of his breach
of any provision of Section 10, 11 or 12 hereof, money damages would be
inadequate and the Company would have no adequate remedy at law. Accordingly,
Consultant agrees that in the event of a breach or a threatened breach by
Consultant of any of the provisions of Section 10, 11 or 12 hereof the Company,
in addition and supplementary to other rights and remedies existing in its
favor, may apply to any court of law or equity of competent jurisdiction for
specific performance and/or injunctive or other relief in order to enforce or
prevent any violations of the provisions hereof (without posting a bond or other
security).

 

14. Notices. All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in
writing and delivered personally, mailed by certified or registered mail, return
receipt requested and postage prepaid, sent via a nationally recognized
overnight courier, charges prepaid, or sent via facsimile. Such notices, demands
and other communications will be sent to the address indicated below:

 

To the Company:

 

Global Power Equipment Group Inc.

6120 South Yale, Suite 1480

Tulsa, OK 74136

Attention: General Counsel

Facsimile No.: (918) 274-2367

 

To the Consultant:

 

Gary J. Obermiller

825 Brockton Lane

Plymouth, Minnesota 55447

 

or such other address or to the attention of such other person as the recipient
party will have specified by prior written notice to the sending party. Any such
notice, demand or other communication will be deemed to have been received (a)
when delivered, if personally delivered, or sent by nationally-recognized
overnight courier or sent via facsimile or (b) on the third business day
following the date on which the piece of mail containing such notice, demand or
other communication is posted if sent by certified or registered mail.

 

15. Severability. If any provision or clause of this Agreement, or portion
thereof shall be held by any court or other tribunal of competent jurisdiction
to be illegal, invalid, or unenforceable in such jurisdiction, the remainder of
such provision will not be thereby affected and will be given full effect,
without regard to the invalid portion. It is the intention of the parties that,
if any court construes any provision or clause of this Agreement, or any portion
thereof, to be illegal, void or unenforceable because of the duration of such
provision or the area matter covered thereby, such court will reduce the
duration, area, or matter of such provision, and, in its reduced form, such
provision will then be enforceable and will be enforced.

 

16. Assignment. All rights and obligations herein contained will inure to the
benefit of and be binding upon the Company, Consultant, their successors and
their permitted assigns. Consultant will not assign any rights or obligations
under this Agreement without the prior written consent of the Company. The
Company may assign the rights or obligations under this Agreement to any
successor in interest to the Company.

 

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17. Governing Law. Except as otherwise provided below, this Agreement shall be
governed in all respects, including validity, interpretation and effect, by the
laws of the State of Minnesota, regardless of the laws that might otherwise
govern under applicable principles of conflicts of laws thereof. It is
acknowledged, however, that the terms and provisions of this Agreement have been
arrived at in good faith by the parties hereto, and the parties intend that this
Agreement shall be fully enforceable. To that end the parties agree that to the
extent that this Agreement or some aspect thereof or the performance or breach
thereof bears a reasonable relationship to a jurisdiction other than the State
of Minnesota and if the same shall be enforceable under the laws of such
jurisdiction but not the State of Minnesota, the laws of the jurisdiction in
which such enforceability prevails shall govern their rights and duties in that
regard.

 

18. Entire Agreement and Waiver. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes any other understanding entered into by or on account of the parties
with respect to the subject matter hereof to the extent inconsistent herewith.
This Agreement may not be changed, modified or amended except in writing signed
by the parties hereto. The failure of either party to exercise any rights under
this Agreement for a breach thereof will not be deemed to be a waiver of such
rights or a waiver of any subsequent breach.

 

19. Effectiveness; Counterparts. This Agreement shall be void and of no force or
effect if Consultant does not execute and deliver this Agreement and the
Separation Agreement to the Company on or before January 30, 2004 or revokes the
Release (as defined in the Separation Agreement). This Agreement may be executed
in one or more counterparts, which shall, collectively and separately,
constitute one agreement.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
applicable date set forth below.

 

“Company”

 

“Consultant”

Global Power Equipment Group Inc.

   

By:

 

/s/ John M. Matheson

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/s/ Gary J. Obermiller

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John M. Matheson

 

Gary J. Obermiller

   

Vice President and General Counsel

 

Date of Signature: January 30, 2004

   

Date of Signature: January 30, 2004

   

 

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