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EXHIBIT 10.5
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (the "Agreement") is executed as of March
20, 1997, by and between Olicom, Inc. a Delaware corporation ("Olicom") and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (the "Consultant").
Concurrently with the execution and delivery of this Agreement, Olicom
A/S, a corporation organized under the laws of the Kingdom of Denmark (the
"Parent"), PW Acquisition Corporation, a Delaware corporation ("MergerSub"),
and CrossComm Corporation, a Delaware corporation ("CrossComm"), have executed
and delivered an Agreement and Plan of Reorganization dated as of March 20,
1997 (the "Merger Agreement"), providing for the merger of MergerSub into
CrossComm, whereby CrossComm shall be a wholly-owned subsidiary of the Parent
immediately following the Effective Time (as defined in the Merger Agreement)
(the "Merger").
In connection with the transactions contemplated by the Merger
Agreement and in recognition of the Consultant's significant experience and
abilities, Parent desires to assure itself of the services of the Consultant in
accordance with and subject to the terms and conditions provided herein. The
Consultant wishes to perform services for Olicom and Parent in accordance with
and subject to the terms and conditions provided herein.
NOW, THEREFORE, in consideration of the premises and the respective
covenants and agreements of the parties herein contained, and intending to be
legally bound hereby, the parties hereto agree as follows:
1. Engagement as Consultant. Olicom hereby agrees to engage the
Consultant, and the Consultant hereby agrees to perform services for Olicom, on
the terms and conditions set forth herein.
2. Term. This Agreement is for a period commencing at the
"Effective Time" (as such term is defined in the Merger Agreement) and
extending through December 31, 1997 (the "Term").
3. Duties and Reporting Relationship. The Consultant is retained
to assist Olicom in (i) successfully and expeditiously implementing the
integration of the business of CrossComm and its subsidiaries with those of the
Parent and its subsidiaries (collectively, the "Olicom Group"); (ii) without
limiting the generality of the foregoing, providing assistance and advice
relative to (a) the expeditious realization of synergies as a result of the
combination of CrossComm with the Olicom Group, (b) matters relating to
employees and employee relations issues in connection with the Merger and the
operation of CrossComm after the consummation of the Merger, (c) the
expeditious integration of marketing and administrative functions of CrossComm
with those of the Olicom Group, (d) the expeditious integration of CrossComm's
technology with that of the Olicom Group, (e) the expeditious integration of
CrossComm's operations in Poland with those of the Olicom Group, and (f)
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in general, apprising employees of, contractors to, and others who have
business relationships with CrossComm or its subsidiaries of the benefits of
the Merger and of the advantages to be gained for all such persons, CrossComm
and the Olicom Group from the consummation of the Merger; (iii) providing
advice and assistance with respect to existing customers of CrossComm, toward
the end that business relationships with such customers are preserved to the
greatest extent feasible; (iv) providing advice and assistance with respect to
key sales and marketing opportunities; and (v) such other services relating to
the business of the Olicom Group and CrossComm as the Consultant and the
Managing Director of the Parent shall mutually agree.
(a) The Consultant shall in no event be required to
provide more than 15 hours per month (including travel time) of consulting
services to Olicom for the first three months of the Term and no more than 10
hours per month (including travel time) of consulting services to Olicom for
the balance of the Term.
(b) The scheduling of the rendition of services by the
Consultant shall be mutually agreeable to the Consultant and Olicom and shall
be performed substantially in Massachusetts.
4. Independent Contractor. During the term of this Agreement,
the Consultant shall be paid as an independent contractor and not an employee
of Olicom.
5. Compensation and Related Matters.
(a) During the Term, Olicom shall pay to the Consultant a
monthly consulting fee at a rate of $5,500.00 per month.
(b) During the Term, the Consultant will be reimbursed by
Olicom for all ordinary and appropriate business expenses incurred by him in
connection with his performance of consulting services hereunder upon
submission by the Consultant of receipts and other documentation in accordance
with Parent's normal reimbursement procedures.
(c) Parent agrees to grant to the Consultant, at the
Effective Time, an option (the "Option") to purchase 100,000 common shares in
the Parent, nominal value DKK 0.25 per share ("Common Shares"), pursuant to the
terms and provisions of the stock option agreement (the "Stock Option
Agreement") substantially in the form attached hereto as Exhibit A. Parent
agrees to use its best efforts to obtain approval of the 1997 Share Incentive
Plan (as defined in the Stock Option Agreement), at the Parent's 1997 General
Meeting at which the Merger is submitted for approval by the Parent's
shareholders.
6. Termination. Upon any termination of this Agreement or the
Consultant's engagement as a consultant hereunder, the parties hereto shall
have no further obligation or liability under this Agreement, except that (a)
Olicom shall pay the Consultant all fees and reimburse the Consultant for all
expenses incurred prior to the date of termination, and
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(b) the provisions of Sections 5(c) and 6-13 of this Agreement shall survive
any such termination.
7. No Assignment. Neither this Agreement nor any of the rights,
interests or obligations of the parties hereto may be assigned by any of the
parties without the prior written consent of the other. This Agreement and all
rights of the Consultant hereunder shall inure to the benefit of and be
enforceable by the Consultant's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
8. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered personally, telecopied
(which is confirmed) or sent by an overnight courier service to the parties at
the following addresses (or at such other addresses for a party as shall be
specified by the notice):
If to Olicom:
Olicom A/S
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Copy to:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Liddell, Sapp, Zivley, Hill & ▇▇▇▇▇▇, L.L.P.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
If to the Consultant:
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All notices shall be effective on receipt.
9. Disputes. Any dispute, controversy or claim arising out of or
relating to this Agreement, including any annexes hereto, or the breach,
termination or validity hereof, shall be finally settled by arbitration by one
arbitrator in Boston, Massachusetts, pursuant to the Commercial Arbitration
Rules of the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator's award in any court of competent jurisdiction. The
arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. Section
1-16.
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10. Miscellaneous. No provisions of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing signed by the parties hereto. No waiver by a party hereto
at any time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. Together with the Merger
Agreement, this Agreement contains the entire understanding of the parties in
respect of the subject matter hereof, and supersedes all prior negotiations and
understandings between the parties with respect to such subject matter. This
Agreement shall be governed and construed in accordance with the laws of the
State of Delaware, without giving effect to the principles of conflicts of law.
11. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original but both of which together will
constitute one and the same instrument.
12. Severability. In the event that any provision of this
Agreement, or the application thereof, becomes or is declared by a court of
competent jurisdiction to be illegal, void or unenforceable, the remainder of
this Agreement will continue in full force and effect and the application of
such provision to other persons or circumstances will be interpreted so as
reasonably to effect the intent of the parties hereto. The parties further
agree to replace such void or unenforceable provision of this Agreement with a
valid and enforceable provision that will achieve, to the extent possible, the
economic, business and other purposes of such void or unenforceable provision.
13. Effect of Headings; Exhibits. The section headings herein are
for convenience only and shall not affect the construction or interpretation of
this Agreement. All exhibits attached hereto are incorporated herein by
reference.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed on the day and year first above written.
OLICOM, INC.
By: /s/ Lars ▇▇▇▇ ▇▇▇▇▇▇▇
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Lars ▇▇▇▇ ▇▇▇▇▇▇▇,
Chairman of the Board
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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OLICOM A/S
By: /s/ Boje Rinhart
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Boje Rinhart, Chief Financial Officer
(For the sole purpose of guaranteeing the
performance of the obligations of the
Parent pursuant to Section 5(c))
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EXHIBIT A
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (the "Agreement") is made and entered into as
of __________, 1997, by and between Olicom A/S, a corporation organized under
the laws of the Kingdom of Denmark (the "Company"), and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (the
"Optionee").
Pursuant to that certain Consulting Agreement of even date herewith
between Olicom, Inc., a Delaware corporation (the "Sub"), and the Optionee, Sub
has agreed to cause the Company to afford the Optionee an opportunity to
purchase common shares, nominal value DKK 0.25 per share (the "Common Shares"),
pursuant to the Company's 1997 Share Incentive Plan (the "Plan").
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Optionee agree as follows:
1. Grant of Option. The Company hereby grants to the Optionee
the right, privilege and option (the "Option") pursuant to the Plan to purchase
100,000 Common Shares (the "Option Shares") at a purchase price per share equal
to the high and low sales prices of the Common Shares on the date hereof (the
"Option Price"), in the manner and subject to the conditions hereinafter
provided.
2. Time of Exercise of Option. Subject to the limitations
contained in this Agreement, the Option may be exercised in whole or in part
until the termination thereof as provided in Section 4 hereof.
3. Method of Exercise. The Option shall be exercised by the
Optionee by the Optionee notifying the Board of Directors of the Company, at
the Company's principal place of business, specifying the number of Option
Shares purchased and accompanied by payment of the aggregate Option Price
therefor.
(a) The Company shall make prompt delivery of Option
Shares purchased; provided, however, that if any law or regulation requires the
Company to take any action with respect to the Option Shares specified in such
notice before the issuance thereof, then the date of delivery of such Option
Shares shall be extended for the period necessary to take such action.
(b) The Option may be exercised, within the above
limitations and subject to the limitations contained in this Agreement, as to
any part or all of the Option Shares covered thereby; provided, however, that
the Option may not be exercised as to less than 500 Option Shares at any one
time (or the remaining Option Shares then purchasable under the Option, if less
than 500 Option Shares).
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4. Termination of Option. Except as herein otherwise stated, the
Option, to the extent not theretofore exercised, shall terminate upon the first
to occur of the following dates:
(a) The expiration of one year after the later of the
date on which the Optionee's consultancy to the Company is terminated for any
reason or such date as the Optionee ceases to be a director of Olicom or any
subsidiary thereof;
(b) ________, 2000 (being the expiration of three years
from the grant of this Option).
5. Reclassification, Consolidation or Merger. If all or any
portion of the Option shall be exercised subsequent to any share dividend,
split-up, recapitalization, merger, consolidation, combination or exchange of
shares, reorganization or liquidation occurring after the date hereof, as a
result of which shares of any class of the capital stock of the Company shall
be issued in respect of the then issued and outstanding Common Shares, or
Common Shares shall be changed into the same or a different number of shares of
the same or another class or classes of the capital stock of the Company, the
person or persons so exercising the Option shall receive, for the aggregate
price paid upon such exercise, the aggregate number and class of shares of the
capital stock of the Company which, if Common Shares (as authorized at the date
hereof) had been purchased immediately prior to such event at the price per
share set forth in Section 1 hereof, such person or persons would be holding at
the time of such exercise; provided, however, that no fractional share shall be
issued upon any such exercise, and the aggregate price paid shall be
appropriately reduced on account of any fractional share not issued; and
provided further that no adjustment shall be made in the minimum number of
shares which may be purchased at any one time, as fixed by Section 3 hereof.
6. Restrictions. The Option and all Option Shares issued
pursuant to the exercise of the Option evidenced by this Agreement shall be
restricted as set forth herein.
(a) If at any time the Company shall determine, in their
discretion, that the listing, registration or qualification of the Option
Shares on any securities exchange or under any state or federal law, or the
consent or approval of any government regulatory body, is necessary or
desirable as a condition of, or in connection with, the granting or exercise of
the Option or the issue or purchase of Option Shares, the Option may not be
exercised in whole or in part until such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to the Company. Subject to the terms and provisions of the
Agreement and Plan of Reorganization of even date herewith between the Company,
PW Acquisition Corporation and CrossComm Corporation (the "Merger Agreement"),
the Company shall be under no obligation to effect or obtain any such listing,
registration, qualification, consent or approval if the Company shall
determine, in its reasonable judgment, that such action would not be in the
best interest of the Company. The Company shall be liable for damages due to a
delay in the delivery or issuance of any stock certificates for any reason
whatsoever, including, without limitation,
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a delay caused by listing, registration or qualification of Option Shares upon
any securities exchange or under any federal or state law or the effecting or
obtaining of any consent or approval of any governmental or regulatory body
with respect to the granting or exercise of the Option or the issue or purchase
of Option Shares (subject to the provisions of the Merger Agreement).
(b) The Company may suspend for a reasonable period or
periods the time during which this Option may be exercised if, in the
reasonable opinion of the Company, such suspension is required to enable the
Company to remain in compliance with regulatory requirements relating to the
issuance of Common Shares subject to this Option; provided, however, that in
the event that Company suspends the period during which this Option may be
exercised pursuant to this Section 6(b), the period of time during which this
Option may be exercised shall be extended for a period of time equal to the
time during which the exercise of this Option was suspended.
7. Rights Prior to Exercise of Option. This Option is not
transferable by the Optionee. Transfers by inheritance or by partition of an
estate may be effected without approval by the Company's Board of Directors.
The Optionee shall have no rights as a shareholder with respect to the Option
Shares until payment of the Option Price therefor and delivery to him of such
shares as herein provided. Furthermore, the grant of the Option shall not be
construed as giving to the Optionee the right to be retained in the service of
the Company or any subsidiary, affiliate or successor of the Company, all such
rights being determined pursuant to that certain Consulting Agreement of even
date herewith between Olicom, Inc., and the Optionee.
8. Conflict with the Plan. The Option granted in this Agreement
is expressly made subject to the Plan. To the extent that there arises any
conflict between this Agreement and the Plan, the Plan shall be deemed to be
paramount and controlling.
9. Entire Agreement; Modification; Waiver. Except for the Plan,
this Agreement constitutes the entire agreement between the parties pertaining
to the subject matter contained in it and supersedes all prior and
contemporaneous agreements, representations and understandings of the parties
with respect thereto. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by the party to be
charged therewith. No waiver of any of the provisions of this Agreement shall
be deemed, or shall constitute, a waiver of any other provision, whether or not
similar, nor shall any waiver constitute a continuing waiver.
10. Applicable Law. The parties agree that this Agreement shall
be governed by and construed in accordance with the laws of the State of
Delaware (without regard to principles of conflicts of laws).
11. Arbitration. Any dispute, controversy or claim arising out of
or relating to this Agreement, including any annexes hereto, or the breach,
termination or validity hereof, shall be finally settled by arbitration by one
arbitrator in Boston, Massachusetts, pursuant to the
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Commercial Arbitration Rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitrator's award in any court of
competent jurisdiction. The arbitration shall be governed by the Federal
Arbitration Act, 9 U.S.C. Section 1-16.
12. Headings. The subject headings of the sections of this
Agreement are included for purposes of convenience only, and shall not affect
the construction or interpretation of any of its provisions.
13. Counterparts. This Agreement may be executed simultaneously
in one or more identical counterparts, each of which for all purposes shall be
deemed an original, and all of which shall constitute, collectively, one
instrument; but in making proof of this Agreement, it shall not be necessary to
produce or account for more than one executed counterpart.
14. Severability. In the event that any provision of this
Agreement, or the application thereof, becomes or is declared by a court of
competent jurisdiction to be illegal, void or unenforceable, the remainder of
this Agreement will continue in full force and effect and the application of
such provision to other persons or circumstances will be interpreted so as
reasonably to effect the intent of the parties hereto. The parties further
agree to replace such void or unenforceable provision of this Agreement with a
valid and enforceable provision that will achieve, to the extent possible, the
economic, business and other purposes of such void or unenforceable provision.
IN WITNESS THEREOF, the parties have executed this Agreement as of the
date and year first above written.
OLICOM A/S
By:
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Its:
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