EXHIBIT 10.1
CONSULTING AGREEMENT
CONSULTING AGREEMENT (this "Agreement") dated as of June 2, 2003 between
Kontron Mobile Computing, Inc., a Minnesota corporation (the "Company"), and
Xxxxx X. Xxxxxxxx ("Xxxxxxxx"), an individual resident of the State of
Minnesota.
WHEREAS, Xxxxxxxx has continuously served as a director of the Company
since October 1996 and as the Company's Chairman since January 1997; and
WHEREAS, Xxxxxxxx previously served as the Company's Chief Executive
Officer from July 1998 until July 1999; and
WHEREAS, the Company desires to retain Xxxxxxxx to render consulting and
advisory services for the Company and its affiliates on the terms and conditions
set forth in this Agreement, and Xxxxxxxx desires to be retained by the Company
on such terms and conditions.
NOW, THEREFORE, in consideration of the premises, the mutual agreements
herein set forth and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties agree as follows:
1. Retention of Xxxxxxxx; Services to be Performed.
(a) The Company hereby retains Xxxxxxxx to render such consulting and
advisory services as the Company may request from time to time. Xxxxxxxx
hereby accepts such engagement and agrees to perform such services upon
the terms and conditions set forth in this Agreement. During the Term (as
defined in Section 2), Xxxxxxxx shall devote such portion of his time,
attention, skill and energy to the business of the Company and its
affiliates as may be reasonably required to perform the services required
by this Agreement, and shall assume and perform to the best of his
ability such reasonable responsibilities and duties as the Company shall
assign to Xxxxxxxx from time to time. Xxxxxxxx shall report to the
Company's Board of Directors.
(b) Xxxxxxxx shall perform the services hereunder primarily at the
Company's headquarters located at 0000 Xxxxxxx Xxxxx, Xxxx Xxxxxxx,
Xxxxxxxxx, but he shall, at the Company's expense, also be required to
render the services at such other locations as the Company may specify
from time to time; provided, however, that Xxxxxxxx shall not be required
at any time to move from his then-current principal residence.
(c) In rendering services hereunder, Xxxxxxxx shall be acting as an
independent contractor and not as an employee or agent of the Company. As
an independent contractor, Xxxxxxxx shall have no authority, express or
implied, to commit or obligate the Company in any manner whatsoever,
except as specifically authorized from time to time in writing by an
authorized representative of the Company, which authorization may be
general or specific. Nothing contained in this Agreement shall be
construed or applied to create a partnership. Xxxxxxxx shall be
responsible for the
payment of all federal, state or local taxes payable with respect to all
amounts paid to Xxxxxxxx under this Agreement; provided, however, that if
the Company is determined to be liable for collection and/or remittance
of any such taxes, Xxxxxxxx shall immediately reimburse the Company for
all such payments made by the Company.
2. Term. Unless terminated at an earlier date in accordance with Section
6, this Agreement shall commence as of the date first written above and shall
continue in full force and effect until December 31, 2020 (the "Term").
3. Compensation. As compensation in full for Xxxxxxxx'x services
hereunder, and in consideration for past services rendered by Xxxxxxxx to the
Company prior to the date hereof, the Company shall make a one-time payment to
Xxxxxxxx on the date of this Agreement of $56,383.00. In addition, the Company
shall pay to Xxxxxxxx if he is living, or, if Xxxxxxxx is not living, to Xxx
Xxxxxxxx, if she is then living, a retainer in the amount of $29,880.00 per
annum. The first annual retainer payment shall be payable on the date of this
Agreement and each subsequent retainer payment shall be payable on January 1 of
each year during the Term beginning on January 1, 2004. If Xxxxxxxx dies before
the end of the Term, the Company shall pay to Xxx Xxxxxxxx the remaining unpaid
annual retainer payments as they become due as provided above; provided,
however, that in the event Xxx Xxxxxxxx does not survive Xxxxxxxx or Xxx
Xxxxxxxx survives Xxxxxxxx but dies during the term of this Agreement, the
Company no longer shall be obligated to make any further payments hereunder.
4. Expenses. The Company shall reimburse Xxxxxxxx in accordance with the
policies and procedures that the Company establishes from time to time for all
reasonable and necessary out-of-pocket expenses that Xxxxxxxx incurs in
performing the services hereunder, including, without limitation, reasonable
travel expenses incurred by Xxxxxxxx.
5. Protection of Confidential Information.
(a) Confidential Information. Except as permitted or directed by the
Chief Executive Officer of the Company, during the Term or at any time
thereafter Xxxxxxxx shall not divulge, furnish or make accessible to anyone or
use in any way (other than in the ordinary course of the business of the
Company) any confidential or secret knowledge or information of the Company that
Xxxxxxxx has acquired or become acquainted with or will acquire or become
acquainted with during the Term or during engagement by the Company or any
affiliated companies prior to the Term, whether developed by Xxxxxxxx or by
others, concerning any trade secrets, confidential or secret designs, processes,
formulae, products or future products, plans, devices or material (whether or
not patented or patentable) directly or indirectly useful in any aspect of the
business of the Company, any customer or supplier lists of the Company, any
confidential or secret development or research work of the Company, or any other
confidential information or secret aspects of the business of the Company.
Xxxxxxxx acknowledges that the above-described knowledge or information
constitutes a unique and valuable asset of the Company acquired at great time
and expense by the Company and its predecessors, and that any disclosure or
other use of such knowledge or information other than for the sole benefit of
the Company would be wrongful and would cause irreparable harm to the Company.
Both during and after the Term, Xxxxxxxx will refrain from any acts or omissions
that would reduce the value of such knowledge or information to the Company. The
foregoing obligations of
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confidentiality, however, shall not apply to any knowledge or information which
is now published or which subsequently becomes generally publicly known in the
form in which it was obtained from the Company, other than as a direct or
indirect result of the breach of this Agreement by Xxxxxxxx.
(b) Return of Records. Upon termination of this Agreement, Xxxxxxxx
shall deliver to the Company all property that is in his possession and that is
the Company's property or relates to the Company's business, including, but not
limited to records, notes, data, memoranda, software, electronic information,
models, equipment, and any copies of the same. Xxxxxxxx shall permanently delete
all of his electronic data containing such property.
6. Termination.
(a) This Agreement and the rights and obligations of the Company and
Xxxxxxxx hereunder (other than the rights and obligations of the parties
under Sections 5 and 6, and except as specifically describe in Section
6(b) below) shall be terminated immediately upon the occurrence of any of
the following events:
(i) Xxxxxxxx'x death;
(ii) Xxxxxxxx has committed fraud, misappropriation, embezzlement or
any other felony in connection with the Company's business; or
(iii) a party is in material breach of this Agreement and has failed
to cure such material breach within 30 days of the receipt of written
notice of breach from the non-breaching party.
If this Agreement is terminated by the Company pursuant to Section
6(a)(ii) or 6(a)(iii), all rights to receive retainer payments under this
Agreement shall terminate on such date. If this Agreement is terminated pursuant
to Section 6(a)(i) or by Xxxxxxxx pursuant to 6(a)(iii), the Company will
continue to be obligated to make payments to Xxxxxxxx if he is living, or, if
Xxxxxxxx is not living, to Xxx Xxxxxxxx, if she is then living, in accordance
with the terms and conditions set forth in Section 3 above; provided, however,
that in the event Xxx Xxxxxxxx does not survive Xxxxxxxx or Xxx Xxxxxxxx
survives Xxxxxxxx but dies during the term of this Agreement, the Company no
longer shall be obligated to make any further payments hereunder.
7. Miscellaneous.
(a) Entire Agreement. This Agreement contains the entire understanding
between the parties hereto with respect to the subject matter hereof and
supersedes any prior understandings, agreements or representations, written or
oral, relating to the subject matter hereof.
(b) Counterparts. This Agreement may be executed in separate
counterparts, each of which will be an original and all of which taken together
shall constitute one and the same agreement, and any party hereto may execute
this Agreement by signing any such counterpart.
(c) Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such a manner as to be effective and valid under
applicable law but if any
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provision of this Agreement is held to be invalid, illegal or unenforceable
under any applicable law or rule, the validity, legality and enforceability of
the other provision of this Agreement will not be affected or impaired thereby.
(d) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of and successor of the Company, and any successor shall be
deemed substituted for the Company under the terms of this Agreement. As used in
this Agreement, "successor" shall include any person, firm, corporation or other
business entity which at any time, whether by merger, purchase or otherwise,
acquires all or substantially all of the assets or business of the Company.
(e) Assignment. This Agreement and the rights and obligations of the
parties hereunder shall not be assignable, in whole or in part, by either party
without the prior written consent of the other party.
(f) Modification, Amendment, Waiver or Termination. No provision of this
Agreement may be modified, amended, waived or terminated except by an instrument
in writing signed by the parties to this Agreement. No course of dealing between
the parties will modify, amend, waive or terminate any provision of this
Agreement or any rights or obligations of any party under or by reason of this
Agreement.
(g) Notices. All notices, demands and other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in
writing and will be deemed to have been given (i) when personally delivered,
(ii) when receipt is electronically confirmed, if sent by facsimile, telecopy or
other electronic transmission device; provided, however, that if receipt is
confirmed after normal business hours of the recipient, notice shall be deemed
to have been given on the next business day, (iii) one day after deposit with a
nationally recognized overnight courier, specifying next day delivery or (iv)
three days after being sent by registered or certified mail. Notices, demands
and communications to the Company and the Xxxxxxxx will, unless another address
is specified in writing, be sent to the address indicated below:
Notices to the Company: Kontron Mobile Computing, Inc.
0000 Xxxxxxx Xxxxx
Xxxx Xxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attention: Board of Directors
Notices to Xxxxxxxx: Xxxxx X. Xxxxxxxx
00000 Xxxxx Xxxxx Xxxx
Xxxx Xxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Any party may change the address set forth above by notice to each other
party given as provided herein.
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(h) Headings. The headings and any table of contents contained in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.
(i) Governing Law. ALL MATTERS RELATING TO THE INTERPRETATION,
CONSTRUCTION, VALIDITY AND ENFORCEMENT OF THIS AGREEMENT SHALL BE GOVERNED BY
THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO ANY CHOICE
OF LAW PROVISIONS THEREOF.
(j) Third-Party Benefit. Nothing in this Agreement, express or implied,
is intended to confer upon any other person any rights, remedies, obligations or
liabilities of any nature whatsoever.
(k) No Waiver. No delay on the part of the Company in exercising any
right hereunder shall operate as a waiver of such right. No waiver, express or
implied, by the Company of any right or any breach by Xxxxxxxx shall constitute
a waiver of any other right or breach by Xxxxxxxx.
(l) Jurisdiction and Venue. THIS AGREEMENT MAY BE ENFORCED IN ANY FEDERAL
COURT OR STATE COURT SITTING IN HENNEPIN COUNTY, MINNESOTA, AND EACH PARTY
CONSENTS TO THE JURISDICTION AND VENUE OF ANY SUCH COURT AND WAIVES ANY ARGUMENT
THAT VENUE IN SUCH FORUM IS NOT CONVENIENT. IF ANY PARTY COMMENCES ANY ACTION
UNDER ANY TORT OR CONTRACT THEORY ARISING DIRECTLY OR INDIRECTLY FROM THE
RELATIONSHIP CREATED BY THIS AGREEMENT IN ANOTHER JURISDICTION OR VENUE, ANY
OTHER PARTY TO THIS AGREEMENT SHALL HAVE THE OPTION OF TRANSFERRING THE CASE TO
THE ABOVE-DESCRIBED VENUE OR JURISDICTION OR, IF SUCH TRANSFER CANNOT BE
ACCOMPLISHED, TO HAVE SUCH CASE DISMISSED WITHOUT PREJUDICE.
(m) Waiver of Jury Trial. EACH PARTY IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(n) Remedies. The parties agree that money damages may not be an adequate
remedy for any breach of the provisions of this Agreement and that any party
may, in its discretion, apply to any court of law or equity of competent
jurisdiction for specific performance and injunctive relief in order to enforce
or prevent any violations this Agreement, and any party against whom such
proceeding is brought hereby waives the claim or defense that such party has an
adequate remedy at law and agrees not to raise the defense that the other party
has an adequate remedy at law.
(o) Advice of Counsel. Each party acknowledges that it has been advised
by counsel in the negotiation, execution and delivery of this agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date set forth in the first paragraph.
KONTRON MOBILE COMPUTING, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Name: Xxxxxx Xxxxxxxx
Title: Chief Executive Officer
/s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx
Signature Page to Consulting Agreement
