ADVISORY BOARD MEMBERSHIP AGREEMENT
This
Advisory Board Membership Agreement (this “Agreement”) effective as of
April 1, 2009 (the “Effective
Date”), between QNECTIVE, INC., a Nevada corporation (the “Company”) and Xxxx
Xxxxxxx (the “Advisor”).
The
Company wishes to retain the Advisor to serve on the Company’s advisory
board (the “Advisory Board”) to provide
advisory services to the Company, its officers and directors, and the Advisor
desires to perform such advisory services. Capitalized terms
used herein and not otherwise defined shall have the meanings ascribed in the
Company's Equity Incentive Plan (the "Plan") substantially in the form of Exhibit A annexed
hereto, the terms of which are hereby incorporated by reference
thereto. For purposes of this Agreement, Advisor shall be deemed a
Key Person as defined in the Plan, and the portion of this Agreement governing
the grant of Stock Rights shall be deemed a Stock Rights Agreement as defined in
the Plan. The Plan may be amended from time to time in accordance
with its terms.
Accordingly,
the parties agree as follows:
1. Services.
1.1 The
Advisor will advise the Company’s Board of Directors and management, at
reasonable times, in matters related to the Company’s business as requested by
the Company as set forth below. The Advisor’s duties shall include (but
are not limited to): (a) providing strategic and technical guidance to the
Company in the development of its business, products and market segment focus,
(b) addressing current and future customer needs as well as setting the
course for product development, and (c) attending meetings of the Advisory
Board.
1.2 The
Company currently expects that the Advisory Board will meet at least six (6)
times per year.
2. Advisory
Fees.
(a) In
consideration for the Advisor’s services to the Company, the Advisor will
receive the following fees in cash:
(i) a cash fee in an
annual amount equal to $35,000, payable in twelve (12) equal monthly
installments of $2,916.66 per month on the first day of each month for the
immediately preceding month (the “ Cash Fees”) and
(ii) an attendance fee in an
amount equal to $2,000 for each formally called meeting of the Advisory Panel
which Advisor attends (the "Attendance
Fees").
(b) In
consideration for the Advisor's services to the Company, the Advisory will also
receive the following Stock Rights and Options, subject to the terms
and conditions of the Plan, including but not limited to Article X
(H), and with respect to the Options, pursuant to the terms of a
separately executed Option Agreement between the Company and
Advisor:
(i) an
annual amount of common shares, par value $.001, of the Company stock (the “Common Stock”) having an
annual aggregate Fair Market Value as of the dates of issue equal to
$50,000; such Common Stock to be issued to Advisor in
twelve (12) equal monthly installments of Common Stock on the first day of each
month for the immediately preceding month with the Fair Market Value of each
monthly installment of $4,167 computed on the last day of each month
hereunder (the “Annual Equity Shares”);
and
(ii) an annual
grant on each March 31 hereunder commencing March 31, 2010 (each, a
"Date of Grant") of an Option to acquire that number of shares of Common Stock
equal in value to the amount of $125,000, on each such March 31 (the “Annual Option Shares”) the
Option Price to be the Fair Market Value on each such March 31 subject to
Advisor’s execution and delivery of an Option Agreement substantially in the
form of Exhibit
B hereto (the Cash Fees, Attendance Fees, Annual Equity Shares, and
Annual Option Shares are herein collectively referred to as the
"Fees").
2.1 The
term of this Agreement will begin on the Effective Date of this Agreement and
will end on the third anniversary of this Agreement unless renewed by the
Company by written notice to Advisor within sixty (60) days prior to the end of
the Term or upon earlier termination as provided below (the “Term”).
2.2 This
Agreement may be terminated prior to the third anniversary hereof by either
party with at least fifteen (15) days' prior written notice to the other party.
In the event of any such earlier termination, and subject to the terms of the
Plan the Advisor may be entitled to, and the Company may pay to
Advisor:
(a) his pro rata portion of the Cash Fees through
the termination date, and the Attendance Fees earned but unpaid;
and
(b) a pro rata portion of the
Annual Equity Shares and the Annual Option Shares through the termination
date.
3. Certain Covenants and
Representations.
3.1 The
Advisor will not disclose to the Company any information that the Advisor is
obligated to keep confidential pursuant to an existing confidentiality agreement
with a third party, and nothing in this Agreement will impose any obligation on
the Advisor to the contrary.
3.2 The
advisory work to be performed hereunder will not be conducted on time that is
required to be devoted to any other third party. The Advisor shall not use
the funding, resources, and facilities of any other third party to perform
advisory work hereunder and shall not perform the advisory work hereunder in any
manner that would give any third party rights to the product of such
work.
3.3 The
Advisor has disclosed and, during the Term, will disclose to the Chief Executive
Officer of the Company any conflicts between this Agreement and any other
agreements binding on the Advisor.
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4. Confidentiality.
4.1 The
Advisor acknowledges that, during the course of performing his services
hereunder, the Company will be disclosing information to the Advisor, and the
Advisor will be developing information related to the Company’s intellectual
property, projects, products, potential customers, personnel, business plans,
and finances, as well as other commercially valuable information (collectively
“Confidential
Information”). The Advisor acknowledges that the Company’s business
is extremely competitive, dependent in part upon the maintenance of secrecy, and
that any disclosure of the Confidential Information would result in serious harm
to the Company.
4.2 The
Advisor agrees that the Confidential Information will be used by the Advisor
only in connection with advisory activities hereunder, and will not be used in
any way that is detrimental to the Company.
4.3 The
Advisor agrees not to disclose, directly or indirectly, the Confidential
Information to any third person or entity. The Advisor will treat all
such information as confidential and proprietary property of the
Company.
4.4 The
term “Confidential
Information” does not include information that (i) is or becomes
generally available to the public other than by disclosure in violation of this
Agreement, (ii) was within the Advisor’s possession prior to being
furnished to the Advisor by the Company, (iii) is disclosed to the Advisor
on a nonconfidential basis from a person or entity entitled to so disclose the
information, or (iv) was independently developed by the Advisor without
reference to the information provided by the Company.
4.5 The
Advisor may disclose any Confidential Information that is required to be
disclosed by law, government regulation or court order. If disclosure is
required, the Advisor will give the Company advance notice so that the Company
may seek a protective order or take other action reasonable in light of the
circumstances.
4.6 Upon
termination of this Agreement, the Advisor will promptly return to the Company
all materials containing Confidential Information as well as data, records,
reports and other property, furnished by the Company to the Advisor or produced
by the Advisor in connection with services rendered hereunder, together with all
copies of any of the foregoing. Notwithstanding such return, the Advisor
shall continue to be bound by the terms of the confidentiality provisions
contained in this Section 4.
5. Use of
Name. It is understood that the name of the Advisor and his
current position as an advisor to the Company will appear in appropriate
disclosure and marketing documents in the ordinary course of the Company’s
business. The name of the Advisor will not be used for any other purpose
without the Advisor’s consent.
6. No Conflict: Valid and
Binding. The Advisor represents that neither the execution of
this Agreement nor the performance of Advisor’s obligations under this
Agreement will result in a violation or breach of any other agreement
by which the Advisor is bound. The Company represents that this Agreement
has been duly authorized and executed and is a valid and legally binding
obligation of the Company, subject to no conflicting
agreements.
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7. Notices. Any
notice provided under this Agreement shall be in writing and shall be deemed to
have been effectively given (i) upon receipt when delivered personally,
(ii) on the next business day after sending when sent by private express
mail service (such as Federal Express), or (iii) five (5) days after
sending when sent by regular mail to the following address:
In the
case of the Company:
c/o
Qnective AG
Xxxxxxxxxxxxxxxx
00
XX-0000
Xxxxxx
Xxxxxxxxxxx
Attn:
Chief Executive Officer
In the
case of the Advisor:
Xx. Xxxx
Xxxxxxx
000 Xxx
Xxxxxxx
Xxxxx
Xxxxxx Xxxxxxx, XX 00000
XXX
or to
other such address as may have been designated by the Company or the Advisor by
notice to the other given as provided herein.
8. Independent
Contractor: Withholding. The Advisor will at all times
be an independent contractor, and as such will not have authority to bind the
Company. The Advisor will not act as an agent nor shall he be deemed to be
an employee of the Company for the purposes of any employee benefit program,
unemployment benefits, or otherwise. Other than as set forth in the
Plan, no amount will be withheld from the Fees for payment of any
federal, state, or local taxes the Advisor having sole responsibility to pay
such taxes, if any, and file such returns as shall be required by applicable
laws and regulations. The Advisor agrees to defend, indemnify and hold the
Company harmless from any and all claims by a third party on account of a
failure or alleged failure to pay such taxes or file such returns. Advisor
shall not enter into any agreements or incur any obligations on behalf of the
Company.
9. Assignment. Due
to the personal nature of the services to be rendered by the Advisor, the
Advisor may not assign this Agreement or delegate his duties hereunder.
The Company may assign all rights and liabilities under this Agreement to a
subsidiary or an affiliate or to a successor to all or a substantial part of its
business and assets without the consent of the Advisor. This Agreement
shall be binding upon the heirs and legal representatives of
Advisor.
10. Severability. If
any provision of this Agreement shall be declared invalid, illegal or
unenforceable, such provision shall be severed and the remaining provisions
shall continue in full force and effect.
11. Remedies. The
Advisor acknowledges that the Company would have no adequate remedy at law to
enforce Section 4
hereof. In the event of a violation or alleged violation by the Advisor of
such Section 4, the
Company shall have the right to obtain injunctive or other similar relief, as
well as any other relevant damages, without the requirement of posting a bond or
other similar measures.
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12. Governing Law; Entire
Agreement; Amendment. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed within such State, without reference to, or
application of, conflicts of laws principles and represents the entire
understanding of the parties, supersedes all prior agreements between the
parties, and may only be amended in writing.
IN
WITNESS WHEREOF, the parties have executed this Advisory Board Membership
Agreement as of the date first written above.
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ADVISOR
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By:
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/s/
Xxxxxx Xxxxx
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/s/
Xxxx Xxxxxxx
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Xxxxxx
Xxxxx
Chief
Executive Officer
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XXXX
XXXXXXX
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