CONSULTING AGREEMENT
This Consulting Agreement, including the attached Exhibits ("Agreements") is
made and entered into effective the 1st day of January, 2000, by and between
MEDIA ARTS GROUP, INC.("MAGI"), a Delaware company, and Xxx Xxxxxxxx
("Consultant"). MAGI desires to terminate Consultant's existing employment
agreement and desires to retain Consultant as an independent contractor to
perform consulting services for MAGI as set forth below and Consultant is
willing to perform such services, on terms set forth more fully below. In
consideration of the mutual promises contained herein, the parties agree as
follows:
1. SERVICES AND COMPENSATION
(a) Consultant agrees to perform for MAGI the services described in the
(b) attached EXHIBIT A ("Services").
(c) MAGI agrees to pay Consultant the compensation set forth in the attached
(d) EXHIBIT B for the performance of the Services.
2. CONFIDENTIALITY
(a) "Confidential Information" means any MAGI proprietary information,
technical data, trade secrets or know-how, including, but not limited to,
research, product plans, products, services, suppliers, supplier lists,
customers, customer lists, markets, software, developments, Developments,
processes, formulas, technology, designs, drawings, engineering, marketing,
finances or other business information disclosed by MAGI either directly or
indirectly in writing, orally, electronically, or by drawings or inspection of
parts or equipment.
(b) Consultant will not, during or subsequent to the term of this Agreement,
use Confidential Information for any purpose whatsoever other than the
performance of the Services on behalf of MAGI or disclose Confidential
Information to any third party. Consultant agrees that Confidential
Information shall remain the sole property of MAGI. Consultant agrees to take
all reasonable precautions to prevent unauthorized disclosure of Confidential
Information. Notwithstanding the above, Consultant's obligation under this
Section 2(b) relating to Confidential Information shall not apply to
information which
(i) is known to Consultant at the time of disclosure to Consultant by
MAGI as evidenced by written records of Consultant,
(ii) has become publicly known and made generally available through no
wrongful act of Consultant, or
(iii)has been rightfully received by Consultant from a third party
authorized to make such a disclosure.
(c) Consultant agrees that Consultant will not, during the term of this
Agreement, improperly use or disclose any proprietary information or trade
secrets of any former or current employer or any other person or entity with
which Consultant has an agreement or a duty to keep in confidence information
acquired by Consultant in confidence and that Consultant will not bring onto
the premises of MAGI any unpublished document or proprietary information
belonging to such an employer, person, or entity unless consented to in
writing by such employer, person, or entity. Consultant will indemnify MAGI
and hold it harmless from and against all claims, liabilities, damages and
expenses, including reasonable attorneys' fees and costs of suit, arising out
of or in connection with any violation or claimed violation of a third party's
rights resulting in whole or in part from MAGI's use of the work product of
Consultant under this Agreement.
(d) Consultant recognizes that MAGI has received and in the future will
receive from third parties their confidential or proprietary information
subject to a duty on MAGI's part to maintain the confidentiality of such
information and use it only for certain limited purposes. Consultant agrees
that Consultant owes MAGI and such third parties, during the term of this
Agreement and thereafter, a duty to hold all such confidential or proprietary
information in the strictest confidence and not to disclose it to any person,
firm or corporation or to use it except as necessary in carrying out the
Services for MAGI consistent with MAGI's agreement with such third party.
(e) Upon the termination of this Agreement, or upon MAGI's earlier request,
Consultant will deliver to MAGI all of MAGI's property relating to, and all
tangible and electronic embodiments of, Confidential Information in
Consultant's possession or control.
(f) Consultant represents and warrants that each employee of Consultant, and
each independent contractor of Consultant, if any, has executed an agreement
with Consultant containing provisions in MAGI's favor substantially similar to
this Section 2.
3. OWNERSHIP
(a) Consultant agrees that all copyrightable material, notes, records,
drawings, designs, developments, improvements, developments, discoveries and
trade secrets (collectively, "Developments") conceived, made or discovered by
Consultant in performing the Services, solely or in collaboration with others,
during the term of this Agreement relating to the business of MAGI shall be
the sole property of MAGI. In addition, to the extent allowed by law, any
Developments which constitute copyrightable subject matter shall be considered
"works made for hire" as that term is defined in the United States Copyright
Act. Consultant further agrees to assign (or cause to be assigned) and does
hereby assign fully to MAGI all such Developments and any copyrights, patents,
mask work rights, or other intellectual property rights relating thereto.
(b) Upon the termination of this Agreement, or upon MAGI's earlier request,
Consultant will deliver to MAGI all of MAGI's property relating to, and all
embodiments of, Developments in Consultant's possession and control.
(c) Consultant agrees to assist MAGI, or its authorized representative, at
MAGI's expense, to obtain and from time to time enforce and defend MAGI's
rights in the Developments and any copyrights, patents, mask work rights or
other intellectual property rights relating thereto in any and all countries,
and to execute all documents reasonably necessary for MAGI to do so.
(d) MAGI agrees that if in the course of performing the Services, Consultant
incorporates into any Development developed hereunder any invention,
improvement, development, concept, discovery or other proprietary information
owned by Consultant or in which Consultant has an interest ("Item"), MAGI is
hereby granted and shall have a nonexclusive, royalty-free, perpetual,
irrevocable worldwide license to make, have made, modify, reproduce, display,
use and sell such Item as part of or in connection with such Invention.
(e) Consultant agrees that if MAGI is unable because of Consultant's
unavailability, dissolution, mental or physical incapacity, or for any other
reason, to secure Consultant's signature to apply for or to pursue any
application for any United States or foreign patents or mask work or copyright
registrations covering the Developments assigned to MAGI above, then
Consultant hereby irrevocably designates and appoints MAGI and its duly
authorized officers and agents as Consultant's agent and attorney-in-fact, to
act for and in Consultant's behalf and stead to execute and file any such
applications and to do all other lawfully permitted acts to further the
prosecution and issuance of patents, copyright and mask work registrations
thereon with the same legal force and effect as if executed by Consultant.
(f) Consultant represents and warrants that each employee of Consultant, and
each independent contractor of Consultant, if any, has executed an agreement
with Consultant containing provisions in MAGI's favor substantially similar to
his Section 3.
(g) Notwithstanding any other provision of this Section 3, the provisions of
this Section 3 shall not apply to any Invention that qualifies in all respects
under Section 2870 of the California Labor Code, which provides: "(a) Any
provision in an employment agreement which provides that an employee shall
assign, or offer to assign, any of his or her rights in an invention to his o
her employer shall not apply to an invention that the employee developed
entirely on his or her own time without using the employer's equipment,
supplies, facilities or trade secret information, except for those Developments
that either: (1) Relate at the time of conception or reduction to practice of
the invention to the employer's business, or actual demonstrably anticipated
research or development of the employer. (2) Result from any work performed by
the employee for the employer. (b) To the extent a provision in an employment
agreement purports to require an employee to assign an invention otherwise
excluded from being required to be assigned under subdivision (a), the
provision is against the public policy of this state and is unenforceable."
Consultant shall advise MAGI promptly and in writing of any of his or her
previous or future works or Developments which he believes qualify under the
California Labor Code Section 2870. MAGI agrees to receive such information in
confidence.
4. CONFLICTING OBLIGATIONS
(a) Consultant certifies that Consultant has no outstanding agreement or
obligation that is in conflict with any of the provisions of this Agreement,
or that would preclude Consultant from complying with the provisions hereof,
and further certifies that Consultant will not enter into any such conflicting
agreement during the term of this Agreement.
(b) Consultant represents and warrants that each employee of Consultant, and
each independent contractor of Consultant, if any, has executed an agreement
with Consultant containing provisions in MAGI's favor substantially similar to
this Agreement.
5. TERM AND TERMINATION
(a) This Agreement will commence on the date first written above and will
continue for six (6) months or termination as provided below.
(b) Upon such termination all rights and duties of the parties shall cease
except: (i) that MAGI shall be obligated to pay, within thirty (30) days of
the effective date of termination, all amounts owing to Consultant for unpaid
services and related expenses, if any, in accordance with the provisions of
Section 1 (Services and Compensation hereof; and (ii) Sections 2
(Confidentiality), 3 (Ownership), 7 (Independent Contractors) shall survive
termination of this Agreement.
(c) The parties have as of the effective date of this Agreement negotiated and
agreed that MAGI may not terminate this Agreement at any time for any reason
prior to the full term stated in 5(a) above, and that in all events
Consultant shall be paid all amounts due under the Agreement.
6. ASSIGNMENT
Neither this Agreement nor any right hereunder or interest herein may be
assigned or transferred by Consultant without the express written consent of
MAGI.
7. INDEPENDENT CONTRACTORS
Nothing in this Agreement shall in any way be construed to constitute
Consultant as an agent, employee or representative of MAGI, but Consultant
shall perform the Services hereunder as an independent contractor. Consultant
acknowledges and agrees that Consultant is obligated to report as income all
compensation received by Consultant pursuant to this Agreement, and Consultant
agrees to indemnify MAGI and hold it harmless to the extent of any obligation
imposed on MAGI (i) to pay withholding taxes or similar items or (ii) resulting
from Consultant's being determined not to be an independent contractor.
8. ARBITRATION, EQUITABLE RELIEF AND ATTORNEYS FEES
(a) Except as provided in Section 8(b) below, MAGI and Consultant agree that
any dispute or controversy arising out of or relating to any interpretation,
construction, performance or breach of this Agreement, shall be settled by
arbitration to be held in San Jose, California, by the American Arbitration
Association and in accordance to the then current rules thereof. The
arbitrator may grant injunctions or other relief in such dispute or
controversy. The decision of the arbitrator shall be final, in any court
of competent jurisdiction. In the event that any legal action or arbitration
is brought by any party hereunder, the prevailing party shall be entitled to
recover from the other party all reasonable costs, expenses and attorneys fees
incurred therein.
(b) Consultant agrees that it would be impossible or inadequate to measure and
calculate MAGI's damages from any breach of the covenants set forth in Sections
2 or 3 herein. Accordingly, Consultant agrees that if Consultant breached
Section 2 or 3, MAGI has, in addition to any other right or remedy available,
the right to obtain from any court of competent jurisdiction an order
restraining such breach or threatened breach and specific performance of any
such provision. Consultant further agrees to the extent provided by law that
no bond or other security shall be required in obtaining such equitable relief
and Consultant hereby consents to the issuance of such injunction and the
ordering of such specific performance.
9. GOVERNING LAW
This Agreement shall be governed by, and construed and interpreted under, the
laws of the State of California without reference to conflict of laws
principles.
10. ENTIRE AGREEMENT
This Agreement and the Exhibits hereto form the entire agreement of the parties
and supersedes any prior agreements between them with respect to the subject
matter hereof.
11. WAIVER
Waiver of any term or provision of this Agreement or forbearance to enforce any
term or provision by either party shall not constitute a waiver as to any
subsequent breach or failure of the same term or provision or a waiver of any
other term or provision of this Agreement.
12. MODIFICATION
No modification to this Agreement, nor any waiver of any rights, shall be
effective unless assented to in writing by the party to be charged.
13. COUNTERPARTS
This Agreement may be executed in counterpart, each of which shall be deemed
an original, but both of which together shall constitute one and the same
instrument.
14. INTERPRETATION
Consultant and MAGI agree that this Agreement was the product of negotiation,
with each party having the opportunity to propose modification of terms.
Accordingly, any ambiguity in this Agreement shall not be construed for or
against any party based upon who prepared such terms; the parties hereby
expressly waive California Civil Code Section 1654 with respect thereto.
15. SEVERABILITY
Should any provision of this Agreement be found to be void or unenforceable,
the remainder of this Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the undersigned are duly authorized to execute this
Agreement on behalf of Consultant and MAGI as of the day and year written
above.
CONSULTANT: MEDIA ARTS GROUP INC.
000 Xxxxxxx Xxx.
Xxx Xxxx, XX 00000
By:\s\ Xxx Xxxxxxxx ______________ By:\s\ Xxxxx Fleming____________
Xxx Xxxxxxxx Xxxxx Xxxxxxx CEO
Consultant
By:\s\ Xxxx Kiley_________________
Xxxx Xxxxx, Compensation Committee
By:\s\ Xxxx West__________________
Xxxx Xxxx, Compensation Committee
By:\s\ Norm Nason_________________
Xxxx Xxxxx, Compensation Committee
EXHIBIT A
Services to be performed by Consultant:
Assist in the transition of CEO, as directed by the board of Directors and as
requested by the CEO;
Other duties as reasonably assigned.
EXHIBIT B
Compensation of Consultant:
(a) Rate of Pay: $38,333.33 per month, with payment to be made on the
first day of every month.
(b) Reimbursement of out of pocket costs and expenses
