NON-EMPLOYEE DIRECTOR AGREEMENT
This Non-Employee Director Agreement (the "Agreement") effective this 31st
day of March 2003, by and between GK Intelligent Systems, Inc., a Delaware
corporation, located at 0000 Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx 00000 (the
"Company"), and Xxxx Xxxxxx (the "Director") is made in consideration of the
mutual promises made herein and set forth as follows:
ARTICLE 1.
TERM OF AGREEMENT
1.1 This Agreement will become effective April 1, 2003 and will continue in
effect for a term of one (1) year until the next annual meeting of shareholders,
or until Director's successor is duly appointed and qualified, or until
terminated as provided in Article 6, below.
ARTICLE 2.
SERVICES TO BE PERFORMED BY DIRECTOR
2.1 Services. Director agrees to serve on the Board of Directors of the
Company for the Term of this Agreement.
2.2 Method of Performing Services. Director will determine the method,
details, and means of performing the above-described services. Director may
perform the Services under this Agreement at any suitable time and location of
Director's choice, however the Director shall make himself available to the
Company as set forth in Section 4.3.
2.3 Status of Director. Director is and shall remain a non-employee of the
Company. Director and any agents or employees of Director shall not act as an
officer or employee of Company. Director has no authority to assume or create
any commitment or obligation on behalf of, or to bind, Company in any respect in
an individual capacity.
ARTICLE 3.
COMPENSATION
3.1 Share Fee. As compensation under this Agreement, the Director will
receive three hundred thousand (300,000) shares, or a non-employee director
stock option to purchase three hundred thousand (300,000) shares, of the
Company's Common Stock, $0.001 par value (the "Shares") pursuant to the GK
Intelligent System, Inc. 2003 Stock Option Plan or the Non-Employee Directors
and Consultants Retainer Stock Plan for the Year 2003. The price of any Shares
issued or purchased pursuant to this Agreement shall be deemed to be $0.14 per
Share, which is one hundred percent (100%) of the fair market value of the
Shares on the date hereof.
3.2 Payment of Expenses. Director shall be responsible for his normal and
customary overhead business expenses incurred in performing services under this
Agreement, including without limitation, telephone, facsimile, postage,
photocopying, supplies, rent, and insurance. Travel expenses and other
extraordinary expenses in relation to the Company shall require the Director to
obtain the prior written approval of Company. Where Director is required to
travel outside the State of Texas on business, all travel arrangements will be
at business class, and if not available, then based on available first class
travel accommodations.
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ARTICLE 4.
OBLIGATIONS OF DIRECTOR
4.1 Non-Exclusive Relationship. Company acknowledges and agrees that the
relationship with Director is non-exclusive and Director may represent, perform
services for, and contract with, as many additional Companys, persons or
companies as Director in Director's sole discretion sees fit.
4.2 Director's Qualifications. Director represents and warrants that
Director has the qualifications and skills necessary to perform the services
under this Agreement in a competent and professional manner, and is able to
fulfill the requirements of this Agreement. Director shall comply with all
applicable federal, state and local laws in the performance of its obligations
hereunder, and all materials used by Director in fulfilling its obligations
under this Agreement shall not infringe upon any third party copyright, patent,
trade secret or other proprietary right. Director acknowledges and agrees that
failure to perform all the services required under this agreement constitutes a
material breach of the Agreement.
4.3 Availability of Director. Director acknowledges and agrees that a
material consideration of this Agreement is that Director be in charge of all
services rendered to Company under this Agreement. Further, that the
availability of the Director be the equivalent of one (1) regular business day
per month and that the unavailability of such services shall constitute a
material breach of this Agreement. Should Company not avail itself of Director's
services, from one week to the next, such availability will not be accumulated
without Director's express approval.
4.4 Indemnity. Director agrees to indemnify, defend, and hold Company free
and harmless from all claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries, and deficiencies, including interest,
penalties, attorneys' fees, and costs, including without limitation expert
witnesses' fees, that Company may incur as a result of a breach by Director of
any representation or agreement contained in this Agreement.
4.5 Assignment. Neither this Agreement nor any duties or obligations under
this Agreement may be assigned by Director without the prior written consent of
Company.
ARTICLE 5.
OBLIGATIONS OF COMPANY
5.1 Compliance with Requests. Company agrees to comply with all reasonable
requests of Director necessary to the performance of Director's duties under
this Agreement.
5.2 Place of Work. Company agrees to furnish an office for Director on
Company's premises for use by Director from time-to-time when visiting the New
York/Houston areas to facilitate his performance of the above-described
services.
5.3 Company Provided Information. Company assumes full responsibility for
the accuracy and completeness of all information provided to Director.
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5.4 Indemnity. Company agrees to indemnify, defend, and hold Director free
and harmless from all claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries, and deficiencies, including interest,
penalties, attorneys' fees, and costs, including without limitation expert
witnesses' fees, that Director may incur as a result of any information provided
to Director by Company under this Agreement.
ARTICLE 6.
TERMINATION OF AGREEMENT
6.1 Termination on Notice. Notwithstanding any other provision of this
Agreement, either party may terminate this Agreement at any time by giving
thirty (30) days written notice to the other party. Unless otherwise terminated
as provided in this Agreement, this Agreement will continue in force until the
Services provided for in this Agreement have been fully and completely
performed.
6.2 Termination on Occurrence of Stated Events. This Agreement will
terminate automatically on the occurrence of any of the following events:
6.2.1 Unavailability of Director to manage and oversee all services
rendered to Company by Director under this Agreement;
6.2.2 Bankruptcy or insolvency of either party;
6.2.3 Dissolution of the Company; and/or,
6.2.4 Any assignment of this Agreement by Director without the prior
written consent of Company.
6.3 Termination for Default. If either party defaults in the performance of
this Agreement or materially breaches any of its provisions, the non-breaching
party may terminate this Agreement by giving written notification to the
breaching party. Termination will take effect immediately on receipt of notice
by the breaching party or five (5) days after mailing of notice, whichever
occurs first. For the purposes of this paragraph, material breach of this
Agreement includes, but is not limited to, the following:
6.3.1 Director's failure to perform the services specified in this
Agreement;
6.3.2 Director's material breach of any representation or agreement
contained in Article 4, above; and/or,
6.3.3 Company's material breach of any representation or agreement
contained in Article 5, above.
ARTICLE 7.
COMPANY INFORMATION
7.1 Nondisclosure/Nonuse of Company Information. Director agrees that all
information provided by Company to Director under this Agreement shall not be
disclosed or used by Director for any purpose other than Director's performance
under this Agreement.
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7.2 Confidential Information. Any written, printed, graphic, or
electronically or magnetically recorded information furnished by Company for
Director's use is and shall remain the sole property of Company. This
proprietary information includes, but is not limited to, investor lists,
marketing information, planning, drawings, specifications, and information
concerning Company's employees, products, services, prices, and operations.
Director will keep this confidential information in the strictest confidence,
and will not disclose it by any means to any person except with Director's prior
written approval, and only to the extent necessary to perform the services under
this Agreement. This prohibition also applies to Director's employees, agents,
and subcontractors. On termination of this Agreement or request by Company,
Director will return within two (2) days any confidential information in
Director's possession to Company.
ARTICLE 8.
GENERAL PROVISIONS
8.1 Notices. Any notices to be given by either party to the other shall be
in writing and may be transmitted either by personal delivery or by mail,
registered or certified, postage prepaid with return receipt requested. Mailed
notices shall be addressed to the parties at the addresses appearing in the
introductory paragraph of this Agreement, but each party may change that address
by written notice in accordance with this section. Notices delivered personally
shall be deemed communicated as of the date of actual receipt. Mailed notices
shall be deemed communicated as of five (5) days after the date of mailing.
8.2 Attorneys' Fees and Costs. If this Agreement gives rise to a lawsuit or
other legal proceeding between any of the parties hereto, the prevailing party
shall be entitled to recover court costs, necessary disbursements (including
expert witnesses' fees) and reasonable attorneys' fees, in addition to any other
relief such party may be entitled.
8.3 Entire Agreement. This Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto with respect
to the services provided by Director to Company under this Agreement, and
contains all of the covenants and agreements between the parties with respect to
this Agreement in any manner whatsoever. Each party to this Agreement
acknowledges that no representations, inducements, promises, or agreements,
orally or otherwise, have been made by any party, or anyone acting on behalf of
any party, which are not embodied herein, and that no other agreement,
statement, or promise not contained in this Agreement shall be valid or binding.
8.4 Modifications. Any modification of this Agreement will be effective
only if it is in writing signed by the party to be charged.
8.5 Effect of Waiver. The failure of either party to insist on strict
compliance with any of the terms, covenants, or conditions of this Agreement by
the other party shall not be deemed a waiver of that term, covenant, or
condition, nor shall any waiver or relinquishment of any right or power at any
one time or times be deemed a waiver or relinquishment of that right or power
for all or any other times.
8.6 Partial Invalidity. If any provision in this Agreement is held by a
court of competent jurisdiction to be invalid, void, or unenforceable, the
remaining provisions shall nevertheless continue in full force without being
impaired or invalidated in any way.
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8.7 Law Governing Agreement. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.
8.8 Jurisdiction/Venue. Jurisdiction and venue for any dispute arising out
of this Agreement shall be exclusively in the city of Houston, State of Texas.
8.9 Construction. If any construction is to be made of any provision of
this Agreement, it shall not be construed against either party on the ground
such party was the drafter of the Agreement or any particular provision.
8.10 Time. Time is of the essence in this Agreement.
8.11 Corporate Authorization. If any signatory of this Agreement is a
corporation, said signatory represents and warrants that this Agreement and the
undersigned's execution of this Agreement have been duly authorized and approved
by the corporation's Board of Directors. The undersigned officers and
representatives of the corporation(s) executing this Agreement on behalf of the
corporation(s) represent and warrant they are officers of the corporation(s)
with full authority to execute this Agreement on behalf of the corporation(s).
IN WITNESS WHEREOF, the undersigned have executed this Agreement, effective
as of the date first above written.
COMPANY: DIRECTOR:
GK Intelligent Systems, Inc.
/S/ Xxxx X. Xxxxxxx /S/ Xxxx Xxxxxx
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By: Xxxx X. Xxxxxxx By: Xxxx Xxxxxx
Its: President
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