CONSULTING AGREEMENT
AGREEMENT, dated July 25, 1997, by and between SOFTWARE PUBLISHING
CORPORATION, a Delaware corporation (the "Company") and Xxxxxx X. Xxxxxx, an
individual residing at 00000 Xxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxx 00000 (the
"Consultant").
W I T N E S S E T H:
WHEREAS, from March 1995 through the date hereof, the Consultant has served
as an officer of the Company; and
WHEREAS, the Company desires to retain the Consultant because of his
extensive knowledge, experience and abilities with respect to the business being
conducted by the Company, and the Company considers that the advice of the
Consultant may be important to the continued success of the Company, and the
Consultant is willing to accept a retainer with the Company as a consultant and
to provide to the Company his services, upon the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants and
agreements herein contained, the Company and the Consultant hereby agree as
follows:
Section 1. Consulting Period.
(a) The Company hereby engages the Consultant to furnish the advisory and
consulting services specified herein, and the Consultant hereby accepts such
engagement and agrees to provide such services, on the terms and conditions
herein set forth, for a two (2) year period commencing on the date hereof (the
"Closing Date") and ending on the second anniversary of the date hereof (the
"Consulting Period"). During the Consulting Period, Consultant agrees to devote
all his efforts to the affairs of the Company at all times when he is located at
the Company's offices or conducting business on the Company's behalf.
(b) The Consulting Period may be terminated by the Company:
(i) Upon the date of death of the Consultant;
(ii) 60 days following written notice by the Company to the Consultant
of the Company's termination of the Consulting Period.
(c) In the event the Company terminates the services of the Consultant
pursuant to Section 1(b) hereof, the Company shall pay to the Consultant an
amount equal to $80,000 if no amount is paid pursuant to Section 3(a)(i) hereof.
If a payment is made pursuant to Section 3(a)(i) hereof, no further compensation
will be payable hereunder.
Section 2. Consulting Services.
(a) During the Consulting Period, the Consultant shall furnish the Company
with advisory and consulting services to be determined by the Company relating
to the establishment of strategic development and licensing relationships
("Relationships") between the Company and other computer software companies,
primarily with regard to the Company's Intelligent Formatting technology. For
the purpose of this Agreement, the term "Company" shall include also Software
Publishing Corporation Holdings, Inc., a Delaware corporation ("SPCH") and any
corporation which is a subsidiary or affiliate thereof, and any corporation
which is a successor in interest to the Company or SPCH, whether by reason of
merger, consolidation, and/or purchase or acquisition of substantially all of
the Company's or SPCH's assets or otherwise.
(b) During the Consulting Period, the Consultant shall be available to
furnish advisory and consulting services hereunder at the request of the
Company. During the Consulting Period, the Consultant shall provide to the
Company regular reports regarding the status, progress and proposed terms of any
Relationship, at intervals determined by the Company.
Section 3. Compensation and Expenses.
(a) As compensation for the Consultant's services set forth in Section 2
above, the Company shall pay to the Consultant (i) $40,000, payable upon the
establishment of the first Relationship which yields actual revenues received by
the Company in excess of $40,000 as a direct result of the Consultant's
involvement; (ii) $40,000, payable upon the establishment of the second
Relationship which yields actual revenues received by the Company in excess of
$40,000 as a direct result of the Consultant's involvement; and (iii) for each
subsequent Relationship which directly results from Consultant involvement, an
amount equal to the following percentage of the total revenues actually received
by the Company plus the mutually agreed upon value of the marketing benefit
received by the Company pursuant to the Relationship developed hereto, payable
upon closing:
Amount of Revenue Generated Percentage
$0 - $100,000 25%
$100,000 - $500,000 20%
$500,000 - $1,000,000 15%
over $1,000,000 10%
(b ) The Company will reimburse the Consultant for all reasonable, actual
out-of-pocket expenses incurred by the Consultant in the performance of duties
hereunder at the request of the Company, to the extent such expenses have been
approved in advance by the Company, either upon presentation of properly
itemized charges, receipts and similar documentation or otherwise in accordance
with policies or practices established from time to time by the Company.
Section 4. Independent Contractor
The Consultant shall be an independent contractor and shall not be
considered an employee of the Company for any purpose whatsoever, including, but
not limited to, medical, health or accident insurance or plans, retirement or
pension plans or benefits; incentive, bonus or similar plans; sick, disability
or vacation pay or allowances; withholding, social security or other employer
contributions; and the use of credit cards. The Company will not be responsible
for any income tax withholding with respect to any remuneration paid or payable
to Consultant hereunder.
Section 5. Non-Competition, Confidentiality, Non-Interference and
Proprietary Information.
(a) Non-Competition. During the term of this Agreement (the "Restricted
Period"), the Consultant shall not, without the written consent of the Company,
directly or indirectly,
(i) become associated with, render services to, invest in, represent,
advise or otherwise participate in as an officer, employee, director,
stockholder, partner, promoter, agent of, consultant for or otherwise, any
business which is conducted in any of the jurisdictions in which the Company's
business is conducted and which is competitive with the business conducted by
the Company relating to the Company's Intelligent Formatting or similar
technology which the Company is engaged or plans to be engaged at the time
Consultant's retention by the Company ceased; provided, however, that nothing
contained herein will prevent Consultant from owning less than five percent (5%)
of any class of equity or debt securities listed on a national securities
exchange or traded in any established over-the-counter securities market, so
long as such involvement with the issuer of any such securities is solely that
of a passive investor;
(ii) for the Consultant's own account or for the account of any other
person or entity interfere with the Company's relationship with any of its
suppliers, customers, licensors, licensees, developers, representatives or
agents; or
(iii) solicit, entice or induce on behalf of the Consultant or any other
person or entity, the services, retention or employment of any person who has
been an employee, sales representative, consultant to or agent of the Company
within six months of the date of such individual's departure from the Company.
(b) Confidentiality. In the course of the Consultant's retention by the
Company, the Consultant will have access to and possession of valuable and
important confidential or proprietary data or information of the Company and its
operations. The Consultant will not during the Consultant's retention by the
Company or at any time thereafter divulge or communicate to any person nor shall
the Consultant direct any Company employee, representative or agent to divulge
or communicate to any person (other than to a person bound by confidentiality
obligations similar to those contained herein and other than as necessary in
performing the Consultant's duties hereunder) or use to the detriment of the
Company or for the benefit of any other person, any of such confidential or
proprietary data or information or make or remove any copies thereof, whether or
not marked or otherwise identified as "confidential" or "secret." The Consultant
shall take all reasonable precautions in handling the confidential or
proprietary data or information within the Company to a strict need-to-know
basis and shall comply with any and all security systems and measures adopted
from time to time by the Company to protect the confidentiality of the
confidential or proprietary data or information.
(c) Confidential or Proprietary Data or Information. The term "confidential
or proprietary data or information" as used in this Agreement shall mean
information not generally available to the public, including, without
limitation, all database information, personnel information, financial
information, customer lists, supplier lists, trade secrets, forms, information
regarding operations, systems, trade programs, services, know how, computer and
any other processed or collated data, computer programs, software applications,
technology, pricing, marketing and advertising data.
(d) Proprietary Information and Disclosure. The Consultant agrees that the
Consultant will at all times promptly disclose to the Company in such form and
manner as the Company may reasonably require, any inventions, improvements or
procedural or methodological innovations, inventions, programs, methods, forms,
systems, services, designs, marketing ideas, products or processes (whether or
not capable of being trademarked, copyrighted or patented) conceived or
developed or created by the Consultant during or in connection with the
Consultant's retention hereunder and which relate to the business conducted by
the Company relating to the Company's Intelligent Formatting or similar
technology which the Company is engaged or plans to be engaged ("Intellectual
Property"). The Consultant agrees that all such Intellectual Property shall be
the sole property of the Company, and hereby assigns, conveys and transfers to
the Company all of the Consultant's right, title and interest therein to the
Company. The Consultant further agrees that the Consultant will execute such
instruments and perform such acts as may reasonably be requested by the Company
to transfer to and perfect in the Company all legally protectable rights in such
Intellectual Property.
(f) Return of Property. All written materials, records and documents made
by the Consultant or coming into the Consultant's possession during the
Consultant's retention by the Company concerning any software, technology,
products, processes or equipment manufactured, used, developed, investigated,
purchased, sold or considered by the Company or otherwise concerning the
business or affairs of the Company shall be the sole property of the Company,
and upon termination of the Consultant's retention by the Company, or upon
request of the Company during the Consultant's retention by the Company, the
Consultant shall promptly deliver the same to the Company. In addition, upon
termination of the Consultant's retention by the Company, the Consultant will
deliver to the Company all other Company property in the Consultant's possession
or under the Consultant's control, including, but not limited to, tangible
property, financial statements, marketing and sales data, customer and supplier
lists, database information and other documents, and any Company credit cards.
(g) Survival. The provisions of this Section 5 shall survive the
termination of your retention hereunder.
Section 6. Equitable Relief.
With respect to the covenants contained in Section 5 of this Agreement, the
Consultant agrees that any remedy at law for any breach or threatened or
attempted breach of such covenants may be inadequate and that the Company shall
be entitled to specific performance or any other mode of injunctive and/or other
equitable relief to enforce its rights hereunder or any other relief a court
might award without the necessity of showing any actual damage or irreparable
harm or the posting of any bond or furnishing of other security.
Section 7. Assignment.
This Consulting Agreement shall not be assigned by either party hereto
except that the Company may assign its rights hereunder to any parent,
subsidiary or affiliate or to any successor in interest of the Company whether
by merger, consolidation, purchase or acquisition of substantially all of the
Company's assets or otherwise.
Section 8. Notices.
All notices, requests, demands and other communications hereunder must be
in writing and shall be deemed to have been duly given if mailed, by prepaid,
first-class, registered or certified mail, return receipt requested, delivered
by a nationally recognized overnight courier service or sent by facsimile
transmission electronically confirmed during normal business hours, and
addressed as follows:
(a) If to the Company, to: Software Publishing Corporation Holdings,
Inc.
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Attention: President
Fax No: (000) 000-0000
with copy to: Moritt, Xxxx & Hamroff, LLP
000 Xxxxxx Xxxx Xxxxx
Xxxxxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx
Fax No.: (000) 000-0000
(b) If to the Consultant, to:Xxxxxx X. Xxxxxx
00000 Xxxxx Xxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Fax No.:
with a copy to: Xxxxxx X. Xxxxxx, Esq.
Xxxxxxxxx Parish & Xxxxxx
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Fax No.: (000) 000-0000
Section 9. Miscellaneous.
This Agreement represents the entire understanding of the parties hereto
relating to the retention of the Consultant as a consultant to the Company, and
the terms and provisions of this Agreement may not be modified or amended,
except in writing. Any failure or delay on the part of either party in
exercising any power or right hereunder shall not operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power preclude any
other or further exercise thereof or the exercise of any other right or power
hereunder. The headings in this Agreement are for convenience of reference only
and shall not be considered as part of this Agreement nor limit or otherwise
affect the meaning thereof. This Agreement shall be construed and enforced in
accordance with, and governed by, the laws of the State of California, without
regard to its conflicts of laws or rules.
IN WITNESS WHEREOF, the parties hereto have duly executed this Consulting
Agreement on the day and year first above written.
SOFTWARE PUBLISHING CORPORATION
By: /s/ Xxxxx X. Cinnamon
Xxxxx X. Cinnamon
President
/s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
