Exhibit 10.11
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (this "Agreement") is made on May 30, 1997,
between ZMAX CORPORATION, a Nevada corporation (the "Company"), and XXXXXX
XXXXXXXX, a resident of Vancouver, British Columbia, Canada (the "Consultant").
AGREEMENT
In consideration and the retention of the Consultant by the Company, and
the mutual agreements hereinafter set forth, the parties agree as follows:
1. Engagement as a Consultant. The Company hereby retains the
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Consultant, and the Consultant hereby accepts such engagement by the Company,
upon the terms and conditions of this Agreement.
2. Duties. The Company engages the Consultant to be available on a
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reasonable, on-call basis to provide consulting services related to raising
capital, business development and strategic opportunities, for the Company, as
described in Exhibit A (the "Services"). The Consultant agrees to perform and
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discharge well and faithfully all Services as the Company reasonably may request
of him from time to time. The Consultant will report to the Board of Directors
of the Company. Throughout the term of the Consultant's engagement hereunder,
the Consultant will devote the time necessary to perform the Services but will
not be required to devote his services on a full-time basis, so long as, in the
opinion of the Board of Directors, he is fulfilling his duties under this
Agreement. The Consultant will hold in trust for the Company all funds and
property he receives on behalf of the Company, and he will account for and remit
all such funds to the Company, as applicable.
3. Compensation. As compensation for the Services, the Company will pay
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to the Consultant the amount of U.S. $10,000 per month (the "Consulting Fee"),
payable on the first business day of each month. The Consultant will receive no
compensation in addition to that set forth in this Agreement for any Services
rendered by him to the Company unless otherwise agreed to by the Company.
4. Reimbursement of Expenses. The Consultant will be entitled to be
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reimbursed in accordance with the policies of the Company, as adopted and
amended from time to time, for all reasonable and necessary expenses incurred by
him in connection with the performance of the Services pursuant to this
Agreement; provided that the Consultant will, as a condition of such
reimbursement, submit acceptable verification of the nature and amount of such
expenses in accordance with the reimbursement policies from time to time adopted
by the Company.
5. Term and Termination. The term of the engagement of the Consultant by
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the Company will commence on the date of this Agreement and will continue for
one (1) year
thereafter (the "Term"), unless sooner terminated as provided herein. At the
end of each expiring Term, the Term shall automatically renew for an additional
year, unless either the Consultant or the Company gives notice of termination.
The Company or the Consultant may terminate this Agreement with or without cause
on thirty (30) days notice to the other. Upon the termination of the
Consultant's engagement hereunder, the Company will have no further obligation
to the Consultant, except that the Company will pay to the Consultant any
compensation and reimbursement accrued up to the date of termination hereunder
and unpaid on such date of termination.
6. Agreement Not to Compete or Solicit Customers.
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(a) Agreement Not to Compete. The parties agree that, commencing on
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the effective date of this Agreement and continuing through the Consultant's
engagement hereunder and for two (2) years after the termination of this
Agreement (the "Applicable Period"), the Consultant will not (except on behalf
of or with the prior written consent of the Company, which consent may be
withheld in Company's sole discretion), either directly or indirectly, on his or
another's behalf, (i) engage in (as a director, officer, principal, partner,
consultant or executive or managerial employee) or provide any of the same type
of services performed on behalf of the Company to any Competing Business or (ii)
own a controlling beneficial interest in a Competing Business. For purposes of
this Section, the Consultant acknowledges and agrees that the Business of the
Company (as defined below) is conducted worldwide. "Competing Business" means
any person, firm, corporation, joint venture or other business entity that is
engaged in any aspect of the design, production, marketing, distribution, or
provision of software engineering/reengineering of Year 2000 Compliance Products
and Services (the "Business of the Company"). "Year 2000 Compliance Products
and Services" means software tools, methodologies, processes and associated
services (including without limitation, program management, analysis,
assessment, conversion, testing, quality assurance, and configuration
management) relating to computer software problems and issues associated with
the year 2000.
(b) Agreement Not to Solicit Customers. The Consultant agrees that
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during the Applicable Period, he will not, either directly or indirectly, on the
Consultant's own behalf or in the service of or on behalf of others, solicit or
divert, or attempt to solicit or divert, to a Competing Business, any individual
or entity (i) that is a client or customer of the Company or an Affiliate, (ii)
as to which, to the knowledge of Consultant, the Company or an Affiliate is in
the process of making a proposal or negotiating for a customer or client
relationship or is discussing or conducting a "pilot", or (iii) with whom the
Company or an Affiliate jointly provides services or products through alliances
or joint ventures to a client or customer during the term of the Consultant's
engagement with the Company. "Affiliate" means any entity that directly or
indirectly controls, is controlled by, or is under common control with the
Company.
7. Agreement Not to Solicit Employees. The Consultant agrees that during
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the Applicable Period, he will not, either directly or indirectly, on his own
behalf or in the service of or on behalf of others, solicit, divert or hire
away, or attempt to solicit, divert or hire away, to any Competing Business any
person employed by the Company or an Affiliate, whether or
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not such employee is a full-time or temporary employee of the Company or an
Affiliate and whether or not such employment is pursuant to written agreement,
for a determined period or at will.
8. Ownership and Protection of Confidential Information and Trade
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Secrets.
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(a) Definitions. "Confidential Information" means data and
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information relating to the business of the Company or an Affiliate (which does
not rise to the status of a Trade Secret) that is or has been disclosed to the
Consultant by the Company or an Affiliate or of which the Consultant became
aware as a consequence of or through his relationship to the Company, which has
value to the Company and is not generally known to its competitors.
Confidential Information will not include any data or information that has been
voluntarily disclosed to the public by the Company (except where such public
disclosure has been made by the Consultant without authorization) or that has
been independently developed and disclosed by others, or that otherwise enters
the public domain through lawful means. "Trade Secrets" means information,
including a formula, pattern, compilation, program, device, method, technique,
or process that: (i) derives independent economic value, actual or potential,
from not being generally known to, and not being readily ascertainable by proper
means by, other persons who can obtain economic value from its disclosure or
use, and (ii) is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy.
(b) Confidentiality. All Confidential Information and Trade Secrets
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and all physical embodiments thereof received or developed by the Consultant
while engaged by the Company or an Affiliate are confidential to and are and
will remain the sole and exclusive property of the Company or Affiliate. Except
to the extent necessary to perform the duties assigned by the Company or an
Affiliate, the Consultant will hold such Confidential Information and Trade
Secrets in trust and strictest confidence, and will not use, reproduce,
distribute, disclose or otherwise disseminate the Confidential Information and
Trade Secrets or any physical embodiments thereof and may in no event take any
action causing or fail to take the action necessary in order to prevent, any
Confidential Information and Trade Secrets disclosed to or developed by the
Consultant to lose its character or cease to qualify as Confidential Information
or Trade Secrets.
(c) Return of Company Property. Upon request by the Company or an
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Affiliate, and in any event upon termination of the engagement of the Consultant
with the Company or an Affiliate for any reason, as a prior condition to
receiving any final fees or reimbursement hereunder (including any payments
pursuant to Section 3 hereof), the Consultant will promptly deliver to the
Company or an Affiliate all property belonging to the Company or an Affiliate,
including, without limitation, all Confidential Information and Trade Secrets
(and all embodiments thereof) then in the Consultant's custody, control or
possession.
(d) Survival. The covenants of confidentiality set forth herein will
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apply on and after the date hereof to any Confidential Information and Trade
Secrets disclosed by the Company or an Affiliate, or developed by the Consultant
prior to or after the date hereof. The
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covenants restricting the use of Confidential Information will continue and be
maintained by the Consultant for a period of two (2) years following the
termination of this Agreement. The covenants restricting the use of Trade
Secrets will continue and be maintained by the Consultant following termination
of this Agreement for so long as permitted by the Maryland Uniform Trade Secrets
Act.
9. Remedies. The Consultant agrees that the covenants and agreements
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contained in Sections 6, 7 and 8 hereof are of the essence of this Agreement;
that each of such covenants is reasonable and necessary to protect and preserve
the interests and properties of the Company and the Business of the Company
worldwide; that the Company is engaged in the Business of the Company; that
irreparable loss and damage will be suffered by the Company should the
Consultant breach any of such covenants and agreements; that each of such
covenants and agreements is separate, distinct and severable not only from the
other of such covenants and agreements but also from the other and remaining
provisions of this Agreement; that the unenforceability of any such covenant or
agreement will not affect the validity or enforceability of any other such
covenant or agreements or any other provision or provisions of this Agreement;
and that, in addition to other remedies available to it, the Company will be
entitled to specific performance of this Agreement and to both temporary and
permanent injunctions to prevent a breach or contemplated breach by the
Consultant of any of such covenants or agreements.
10. No Set-Off. The existence of any claim, demand, action or cause of
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action by the Consultant against the Company or any Affiliate, whether
predicated upon this Agreement or otherwise, will not constitute a defense to
the enforcement by the Company of any of its rights hereunder. The existence of
any claim, demand, action or cause of action by the Company against the
Consultant, whether predicated upon this Agreement or otherwise, will not
constitute a defense to the enforcement by the Consultant of any of its rights
hereunder; provided, however, that the Company will have the right to
discontinue payments to the Consultant under Section 3 hereof, as applicable, if
the Consultant should breach any of its obligations under Sections 6, 7 or 8
hereof, and the Company notifies the Consultant of that breach.
11. Notice. All notices, requests, demands and other communications
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required hereunder must be in writing and deemed govern and effective when
personally delivered, sent by fax with confirmation of receipt or when deposited
in the mail with postage prepaid to the party to which the same is directed at
the following addresses (or at such other addresses as will be given in writing
by the parties to one another):
To the Company: ZMAX CORPORATION
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx, President
Fax: 000-000-0000
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To the Consultant: XXXXXX XXXXXXXX
Suite 1819
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
XXXXXX X0X 0X0
Fax: 000-000-0000
12. Miscellaneous.
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(a) Assignment. The Consultant may not assign any rights or delegate
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any duties it has assumed hereunder without the prior written consent of the
Company. This Agreement is personal to the Consultant.
(b) Waiver. A party's waiver of any breach of this Agreement by the
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other will not be effective unless in writing, and no such waiver will
constitute the waiver of the same or another breach on a subsequent occasion.
(c) Consultant as Independent Contractor. The Consultant will act as
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an independent contractor in performing the Services and will not hold himself
out as an employee or agent of the Company. The Consultant has no authority to
bind the Company by virtue of this Agreement without the Company's express prior
consent.
(d) Governing Law and Choice of Forum. This Agreement will be
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governed by and construed in accordance with the internal laws of the State of
Maryland. The parties agree that any appropriate state or federal court located
in Maryland will have exclusive jurisdiction of any case or controversy arising
under or in connection with this Agreement and will be a proper forum in which
to adjudicate such case or controversy. The parties expressly consent to
personal jurisdiction and venue in such courts.
(e) Entire Agreement/Amendment. This Agreement embodies the entire
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agreement of the parties hereto relating to the subject matter hereof and
supersedes all oral agreements, and to the extent inconsistent with the terms
hereof, all other written agreements. This Agreement may not be modified,
amended, supplemented or terminated except by a written instrument executed by
all parties hereto.
(f) Severability. Each of the covenants and agreements hereinabove
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contained will be deemed separate, severable and independent covenants, and in
the event that any covenant will be declared invalid by any court of competent
jurisdiction, such invalidity will not in any manner affect or impair the
validity or enforceability of any other part or provision of such covenant or of
any other covenant contained herein.
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(g) Captions and Section Headings. Captions and section headings used
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herein are for convenience only and are not a part of this Agreement and will
not be used in construing it.
(h) Arbitration. Except as otherwise provided herein, any dispute
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arising under this Agreement will be submitted to a single arbitrator selected
by the American Arbitration Association whose rules of arbitration and
conciliation will apply. The American Arbitration Association will select an
arbitrator experienced in computer consulting.
EXECUTED AS OF May 30, 1997
ZMAX CORPORATION
By: /s/Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
President
/s/Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx
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EXHIBIT A
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DUTIES OF CONSULTANT
The duties of the Consultant will be as follows:
(a) Arrange financing for the Company and its Affiliates, as requested by
the Board of Directors.
(b) Act as a liaison between the Company and the investment community and
brokers.
(c) Research and identify new business and strategic opportunities for the
Company.
(d) Consult with the Company's management and Board of Directors as
needed.
(e) Perform any other duties that management and the Board of Directors
may request from time to time.
