NONEXCLUSIVE INDEPENDENT CONSULTING AGREEMENT
THIS NONEXCLUSIVE CONSULTING AGREEMENT ("Agreement") is made
and entered into effective this _____ day of __________, _____, by and between
Fonix Corporation, a Delaware corporation ("Fonix"), and ___________________, a
company organized and existing under the laws of _________________.
("Consultant"). Hereinafter either party may be referred to as "Party" and
collectively as "Parties."
RECITALS:
WHEREAS, Fonix is a development stage company, of which the
primary business activity is presently the development, marketing, sales and
licensing of certain proprietary human- computer interface technologies and
products. Fonix is seeking new marketing and licensing opportunities as well as
other significant business development opportunities in Europe and Asia; and
WHEREAS, Consultant is generally familiar with many of Fonix's
technologies and products, and has expertise identifying and making
introductions to European and Asian companies interested in purchasing,
licensing or otherwise acquiring the rights to market or use technologies and
products of a type offered by Fonix; and
WHEREAS, Fonix desires that Consultant provide such services
in Europe and Asia as hereinafter set forth.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and
agreements hereinafter set forth and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties agree as follows:
ARTICLE I
CONSULTING
1.1 Description. Fonix hereby retains Consultant
to perform, and Consultant hereby agrees to perform, consulting services to
Fonix as herein provided.
1.2 Services to be Performed. Consultant shall provide
bona fide consulting services to Fonix in connection with Fonix's efforts to
identify and enter into appropriate agreements for sales and with third-party
licensing and co-development partners located principally in Europe and Asia.
Such services shall include, without limitation, (i) consultation regarding
strategic planning, partnerships and similar alliances; (ii) finding and
introducing, on a best efforts and nonexclusive basis, potential buyers and
licensing and co-development partners located principally in Europe and Asia;
and (iii) to the extent requested by Fonix, participating in negotiations with
such potential purchasers and partners.
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1.3 Independent Contractor. Consultant acknowledges
that Consultant's retention does not confer upon Consultant any ownership
interest in or personal claim upon any license, right or product of Fonix, nor
does this Agreement confer any employment right on Consultant. Consultant agrees
that in performing its duties under this Agreement, it shall be operating as an
independent contractor as that term is defined in United States Treasury
Department regulations and United States Internal Revenue Service rulings and
interpretations. Nothing contained herein shall in any way constitute any
association, partnership, employer/employee relationship, or joint venture
between the parties hereto, or be construed to be evidence of the intention of
the parties to establish any such relationship. Neither party shall have any
right, power or authority to make any representation nor to assume or create any
obligation, whether express or implied, on behalf of the other, or to bind the
other party in any manner whatsoever. Both of the parties agree, respectively,
that they shall not hold themselves out in any manner that would be contrary to
the terms of this Section 1.3.
1.4 Confidentiality and Non-Disclosure. Consultant
acknowledges that in performance of services under this Agreement, it may
acquire confidential information concerning Fonix technology, know-how, product
development and marketing plans, business concepts, financial matters and other
information which are valuable, special and unique assets of Fonix (herein
"Information"). Consultant will not, during or after the term of this Agreement,
disclose any Information, no matter how acquired, to any person or entity for
any reason or purpose outside of Consultant's usual business activities as
defined hereunder, and will not in any manner directly or indirectly aid or be a
party to any acts, the effects of which would tend to divert, diminish or
prejudice the technology, good will, business or business opportunities of
Fonix. In the event of a threatened breach of Consultant of the provisions of
this paragraph, Fonix shall be entitled to an injunction restraining Consultant
from disclosing any such information or from rendering any services to any
person or entity to whom any such information has been disclosed or threatened
to be disclosed. Nothing herein shall be construed as prohibiting Fonix from
pursuing any other remedies available to Fonix for actual breach of the
provision of this paragraph, including the recovery of damages from Consultant.
1.4.1 In exchange for Fonix executing this
Agreement and agreeing to the retention of Consultant's services by Fonix,
Consultant does hereby enter into the covenant of confidentiality set forth in
this Section 1.4 (the "Confidentiality Covenant") and acknowledges the
adequacy of the consideration to support the Confidentiality Covenant.
1.4.2 The Confidentiality Covenant shall survive
the expiration or termination of this Agreement.
ARTICLE II
TERM OF CONTRACT
2.1 Term. The term of this Agreement shall be from the
effective date hereof until ________________, except as provided in Article III.
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2.2 Termination for Cause. Consultant acknowledges that its
engagement under this Agreement may be terminated for Cause as set forth herein.
For the purpose of this paragraph, "Cause shall mean any of the following:
2.2.1 fraud or misrepresentation;
2.2.2 Fonix, after consultation with legal counsel
of its choice, reasonably has determined that a violation of law has taken place
or is about to take place in connection with this Agreement; or
2.2.3 violation of a Confidentiality Covenant.,
ARTICLE III
COMPENSATION
3.1 Compensation. As soon as possible after the mutual
execution of this Agreement all Parties, Fonix shall issue as compensation for
Consultant's services under this Agreement, __________________ (___________)
shares of the Company's common stock, par value $.0001 per share (the
"Compensation Shares").
3.2 Registration of Stock. Any offer or issuance of the
Compensation Shares under this Agreement shall be subject to the filing and
effectiveness, at or prior to the time this Agreement is executed by Fonix, of a
registration statement under the U.S. Securities Act of 1933, as amended, on
Form S-8, covering the Compensation Shares.
3.3 Expenses. Consultant shall be responsible for the
payment of any expenses incurred by Consultant in the providing of services
hereunder.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of Consultant. To
induce Fonix to enter into this Agreement, Consultant hereby represents and
warrants as follows:
4.1.1 Restrictions; Limitations. Consultant is
under no obligation or restriction which would in any way interfere or be
inconsistent with, or present a conflict of interest concerning the services
to be furnished to Fonix under this Agreement. Consultant will not enter into
any such obligation or restriction prior to the termination of this Agreement.
4.1.2 Organization, Standing Authorization.
Consultant is duly organized, validly existing, and in good standing under the
laws of Liechtenstein, and has the requisite power and authority to enter into
this Agreement and perform as anticipated by this Agreement. The execution and
delivery of this Agreement by Consultant have been duly authorized by all
required action of Consultant's owners or management. The person executing,
on Consultant's behalf, this Agreement is duly authorized to do so.
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4.1.3 Disclosure, Access to Information.
Consultant confirms that it has received and thoroughly read and is familiar
with and understands this Agreement, and that all documents, records, books and
other information pertaining to Consultant's performance under this
Agreement requested by Consultant have been made available for inspection and
copying and that there are no additional materials or documents that have been
requested by Consultant that have not been made available by Fonix. Consultant
further acknowledges that it understands that Fonix is subject to the periodic
reporting requirements of the U.S. Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and Consultant has reviewed or received copies
of any such reports that have been requested by it. Without limiting the
generality of the foregoing, Consultant acknowledges that it has received and
has reviewed copies of the following reports filed by Fonix:
(a) Annual Report on Form 10-K for the fiscal year
ended December 31, 1998;
(b) Quarterly Reports on Form 10-Q, as amended,
for the quarters ended March 31, 1999, June
30, 1999, and September 30, 1999.
(c) Current Reports on Form 8-K filed during 1999.
Consultant acknowledges that the statements contained in the above-described
Exchange Act Reports are not purely historical and include forward-looking
statements within the meaning of Section 27A of the Act and Section 21E of the
Exchange Act, including statements regarding the Company's expectations, hopes,
intentions or strategies regarding the future. Forward looking statements
include statements regarding future development of fonix's automatic human
computer interaction technologies, statements regarding Fonix's ability to enter
into appropriate licensing and co-development agreements, and projections for
the timing and amount of revenues to be received from Fonix in connection with
such agreements. All such forward looking statements are based on information
available to Fonix on the date hereof, and Fonix assumes no obligation to update
any such forward looking statements. Fonix's actual results could differ
materially from the results predicted in such forward looking statements.
ARTICLE V
MISCELLANEOUS PROVISIONS
5.1 Entire Agreement. This Agreement constitutes the
entire agreement between the parties and supercedes any prior written or oral
agreements concerning the subject matter contained herein.
5.2 Amendment. This Agreement may be amended only by the
written consent of the parties.
5.3 Waiver. No waiver of any breach or default of this
Agreement by either party hereto shall be considered to be a waiver of any other
breach of default of this Agreement.
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5.4 Notices. Any notices pertaining to this Agreement shall be
in writing and shall be transmitted by personal hand delivery or fax to an
officer or director of Fonix or to Consultant, or through the facilities of the
United States Post Office, certified mail, return receipt requested. Notices
given by mail shall be deemed to be delivered on the day such notice is
deposited in the United States mail, postage prepaid.
5.5 Assignment. The Consultant's rights and duties
pursuant to this Agreement are not assignable without the express written
agreement of Fonix. Fonix may assign any of its rights or obligations hereunder.
5.6 Consultant not Exclusive Consultant of Fonix.
Nothing in this Agreement shall restrict or otherwise limit the right of Fonix
to engage or retain other consultants, either as employees or as independent
contractors.
5.7 Indemnification. Consultant will indemnify and hold
harmless Fonix and its directors, officers, and each person, if any, who
controls Fonix within the meaning of the Act, from and against any and all
losses, claims, damages, expenses, liabilities or actions to which any of them
may become subject under applicable law (including, without limitation, the Act)
and will reimburse them or any legal or other expenses incurred by them in
connection with investigating or defending any claims or actions, whether or not
resulting in liability, insofar as such losses, claims, damages, expenses,
liabilities or actions arise out of or are based upon Consultant's failure to
comply with the provisions of this Agreement or the inaccuracy of any
representation made by Consultant in connection with this Agreement. The
indemnification agreement contained in this paragraph shall remain in full force
or effect, regardless of any investigation made by or on behalf of Consultant,
and shall survive the consummation of the transactions contemplated by this
Agreement.
5.8 Attorney Fees and Costs. The parties agree that, in the
event of any dispute arising under this Agreement, the prevailing party in any
such dispute shall be entitled to an award of all costs and expenses, including
without limitation attorneys' fees and legal costs, which may arise from the
enforcement of this Agreement, whether such enforcement is pursued by filing of
a suit or otherwise.
5.9 Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Utah of the United
States of America.
5.10 Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be an
original, and such counterparts together shall constitute one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
FONIX:
FONIX CORPORATION
By:
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Xxxxx X. Xxxxxx
Executive Vice President
CONSULTANT:
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By:
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