EXHIBIT 10.37
AMBIENT CORPORATION
CONSULTING AGREEMENT
This Agreement is made and entered into as of the 29th day of
December 2000, by and between Ambient Corporation, a Delaware corporation (the
"Company") having an office at 0000 Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 and Aviz
Consulting Limited, an Israel Company (the "Consultant").
In consideration of the mutual promises made herein and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Purpose: The Company hereby engages Consultant for the term
specified in Section 2 hereof to render consulting advice to the Company
relating to financial and similar matters upon the terms and conditions set
forth herein.
2. Term: Except as otherwise specified in Section 4 hereof, this
Agreement shall be effective for a period of three (3) years, commencing upon
the date this Agreement is executed in full by the parties hereto.
3. Duties of Consultant: During the term of this Agreement,
Consultant shall provide his advice, knowledge and expertise with respect to
financial matters, which may include organization of equity financings, both
public and private, mergers, acquisitions, reorganizations, joint ventures or
other similar transactions relating to and on behalf of the Company.
4. Compensation:
(a) In consideration for the services rendered by Consultant
to the Company pursuant to this Agreement Consultant shall be entitled to
receive options ("Option" or "Options") to purchase five hundred and fifty
thousand (550,000) shares of common stock of Employer (the "Shares"
or "Share") at a price of $1.00 per Share. Unless accelerated as provided in
Section 8 below, the Options shall vest in installments according to the
following schedule:
(i) 183,333 Options twelve months from the date of this Agreement;
(ii) 183,333 Options twenty-four months from the date of this
Agreement; and
(iii) 183,334 Options thirty-six months from the date of this
Agreement.
(b) The Option shall be evidenced by a written stock option
agreement, in form satisfactory to the Company, executed by the Company and the
Consultant. The Shares underlying the Option shall be fully paid and
non-assessable.
(c) The Option may be exercised during the term in which this
agreement remains in effect and for 3 months thereafter, provided that the
agreement is not terminated for Cause (as defined in section 8 below) by the
Company, by written notice delivered to the Company at its principal executive
office stating the number of Shares with respect to which the Option is being
exercised, together with:
(i) a check or money order made payable to the Company
in the amount of the exercise price and any applicable federal, state and local
withholding tax; or
(ii) the tender to the Company of Shares owned by
Consultant having a fair market value not less than the exercise price, plus the
amount of applicable federal, state and local withholding tax; or
(iii) the surrender of Shares then issuable upon the
exercise of the Option, provided the fair market value of such Shares is equal
on the date to the exercise price, or such portion thereof as Optionee elects to
pay by surrender of such stock, plus the amount of applicable federal, state and
local withholding taxes;
(d) If, at any time within the period which this agreement
remains in effect, the Company should file a registration statement with the
Securities and Exchange Commission (the
"Commission") under the Securities and Exchange Act of 1933, as amended (other
than pursuant to Forms S-4 or S-8), it will give written notice at least twenty
(20) calendar days prior to the filing of each such registration statement to
Consultant of its intention to do so. If Consultant notifies the Company within
fifteen (15) calendar days after receipt of any such notice of its or their
desire to include any of the Shares underlying the Option(s) granted pursuant to
Section 4 (a) in such proposed registration statement, the Company shall afford
Consultant the opportunity to have any such Shares registered under such
registration statement.
(e) Consultant shall be eligible for discretionary performance
based bonuses which shall be paid to Consultant by the Company in amounts and at
such times as determined by the CEO of the Company.
5. The Consultant's Services to Others: The Consultant acknowledges
that the he will dedicate significant time to the Company to fulfill his duties
under this Agreement. Nothing herein shall require Consultant to dedicate a
specific amount of time to the Company in connection with the fulfillment of his
duties however Consultant further acknowledges that he may not be engaged to
provide similar services to others.
6. Indemnification:
(a) The Company shall indemnify and hold Consultant harmless against
any and all liabilities, claims, lawsuits, including any and all awards and/or
judgments to which it may become subject under the Securities Act of 1933, as
amended (the "1933 Act"), the Securities Exchange Act of 1934, as amended (the
"Act") or any other federal or state statute, at common law or otherwise,
insofar as said liabilities, claims and lawsuits (including awards and/or
judgments) arise out of or are in connection with the services rendered by
Consultant in connection with this Agreement, except for any liabilities, claims
and lawsuits (including awards judgments and related costs and expenses),
arising out of acts or omissions of Consultant. In addition, the Company shall
also indemnify and hold Consultant harmless against any and all reasonable costs
and expenses, including reasonable counsel fees, incurred
or relating to the foregoing. If it is finally judicially determined that the
Company will not be responsible for any liabilities, claims and lawsuits or
expenses related thereto, the indemnified party, by his or its acceptance of
such amounts, agrees to repay the Company all amounts previously paid by the
Company to the indemnified person and will pay all costs of collection thereof,
including but not limited to reasonable attorneys' fees related thereto.
(b) The Consultant shall give the Company prompt notice of any such
liability, claim or lawsuit which Consultant contends is the subject matter of
the Company's indemnification and the Company thereupon shall be granted the
right to take any and all necessary and proper action, at its sole cost and
expense, with respect to such liability, claim and lawsuit, including the right
to settle, compromise and dispose of such liability, claim or lawsuit, excepting
therefrom any and all proceedings or hearings before any regulatory bodies
and/or authorities.
(c) The Consultant shall indemnify and hold the Company and its
directors, officers, consultants and agents harmless against any and all
liabilities, claims and lawsuits, including any and all awards and/or judgments
to which it may become subject under the 1933 Act, the Act or any other federal
or state statute, at common law or otherwise, insofar as said liabilities,
claims and lawsuits (including awards and/or judgments) arise out of or are
based upon Consultant's gross negligence, useful misconduct, bad faith or any
untrue statement or alleged untrue statement of a material fact.
(d) The Company shall give Consultant prompt notice of any such
liability, claim or lawsuit which the Company contends is the subject matter of
Consultant's indemnification and Consultant thereupon shall be granted the right
to a take any and all necessary and proper action, at its sole cost and expense,
with respect to such liability, claim and lawsuit, including the right to
settle, compromise or dispose of such liability, claim or lawsuit, excepting
therefrom any and all proceedings or hearings before any regulatory bodies
and/or authorities.
(e) The indemnification provisions contained in this Section 6 are
in addition to any other rights or remedies which either party hereto may have
with respect to the other or hereunder.
7. Change of Control: In the event of a "Change of Control" whereby:
(a) A person (other than a person who is an officer or a Director of
the Company on the effective date hereof), including a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934, becomes, or obtains the
right to become, the beneficial owner of the Company securities having 30% or
more of the combined voting power of then outstanding securities of the Company
that may be cast for the election of directors of the Company;
(b) At any time, a majority of the Board-nominated slate of
candidates for the Board is not elected;
(c) Company consummates a merger in which it is not the surviving
entity;
(d) Substantially all of the Company's assets are sold; or
(e) Company's stockholders approve the dissolution or liquidation of
the company; then:
All stock options, warrants and stock appreciation rights
("Rights") granted by Company to Consultant under any plan or otherwise prior to
the effective date of the Change of Control, shall become vested, accelerate and
become immediately exercisable; at an exercise price of $0.10 (cent) per share
if applicable, adjusted for any stock splits and capital reorganizations having
a similar effect, subsequent to the effective date hereof. In the event
Consultant owns or is entitled to receive any unregistered securities of
Company, then Company shall use its best efforts to effect the registration of
all such securities as soon as practicable, but no later than 120 days after the
effective date of the registration statement; provided, however, that such
period may be extended or delayed by Company for
one period of up to 60 days if, upon the advice of counsel at the time such
registration is required to be filed, or at the time Company is required to
exercise its best efforts to cause such registration statement to become
effective, such delay is advisable and in the best interests of Company because
of the existence of non-public material information, or to allow Company to
complete any pending audit of its financial statements.
8. Termination:
(a) Termination by the Company
(i) The Company may terminate this Agreement upon written
notice for Cause. For purposes hereof, "Cause" shall mean (A) engaging by
Consultant in conduct that constitutes activity in competition with the Company;
(B) disclosure by the Consultant of Information as set forth in Section 9 below
(C) the conviction of Consultant for the commission of a felony; and/or (D) the
habitual abuse of alcohol or controlled substances. Notwithstanding anything to
the contrary in this Section 8 (a)(i), the Company may not terminate
Consultant's employment under this Agreement for Cause unless Consultant shall
have first received notice from the Board advising Consultant of the specific
acts or omissions alleged to constitute Cause, and such acts or omissions
continue after Consultant shall have had a reasonable opportunity (at least 10
days from the date Consultant receives the notice from the Board) to correct the
acts or omissions so complained of. In no event shall alleged incompetence of
Consultant in the performance of Consultant's duties be deemed grounds for
termination for Cause.
(ii) The Company may terminate Consultant's employment under
this Agreement if, as a result of any physical or mental disability, Consultant
shall fail or be unable to perform his duties under this Agreement for any
consecutive period of 90 days during any twelve-month period. If Consultant's
employment is terminated under this Section 9(a)(ii): (A) for the first six
months after termination, Consultant shall be paid 100% of his full compensation
under Section 4(a) of this Agreement at the rate in effect on the date of
termination, and in each successive 12 month period
thereafter Consultant shall be paid an amount equal to 67% of his compensation
under Section 4(a) of this agreement at the rate in effect on the date of
termination.
(iii) This agreement automatically shall terminate upon the
death of Consultant, except that Consultant's estate shall be entitled to
receive any vested or unvested Options granted pursuant to Section 4(a).
(b) Consultant shall have the right to terminate his employment
under this Agreement upon 30 days' notice to Company.
9. Proprietary Information.
(a) The term "Information" means any and all confidential and
proprietary information including but not limited to any and all specifications,
formulae, prototypes, software design plans, computer programs, and any and all
records, data, methods, techniques, processes and projections, plans, marketing
information, materials, financial statements, memoranda, analyses, notes, and
other data and information (in whatever form), as well as improvements and
know-how related thereto, relating to the Company or its products. Information
shall not include information that (a) was already known to or independently
developed by the Consultant prior to its disclosure as demonstrated by
reasonable and tangible evidence satisfactory to the Company; (b) shall have
appeared in any printed publication or patent or shall have become part of the
public knowledge except as a result of breach of this Agreement by the
Consultant or similar agreements by other Company consultants or employees (c)
shall have been received by the Consultant from another person or entity having
no obligation to the Company or (d) is approved in writing by the Company for
release by the Consultant.
(b) The Consultant agrees to hold in trust and confidence all
Information disclosed to it and further confirms that it will not exploit or
disclose the Information to any other person or entity or use the Information
directly or indirectly for any purpose other than for its work with the Company.
(c) The Consultant acknowledges and agrees that the Information
furnished by the Company to it is and shall remain proprietary to the Company.
Unless otherwise required by statute or government rule or regulation, all
copies of the Information, shall be returned to the Company immediately upon
request without retaining copies thereof.
10. Miscellaneous:
(a) This Agreement between the Company and Consultant constitutes
the entire agreement and understanding of the parties hereto, and supersedes any
and all previous agreements and understandings, whether oral or written, between
the parties with respect to the matters set forth herein.
(b) Any notice or communication permitted or required hereunder
shall be in writing and shall be deemed sufficiently given if hand-delivered or
sent (i) postage prepaid by registered mail, return receipt requested, or (ii)
by facsimile, to the respective parties as set forth below, or to such other
address as either party may notify the other in writing:
If to the Company:
Ambient Corporation
0000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
If to the Consultant:
Aviz Consulting Limited
(c) This Agreement shall be binding upon and inure to the benefit of
each of the parties hereto and their respective successors, legal
representatives and assigns.
(d) This Agreement may be executed in any number of counterparts,
each of which together shall constitute one and the same original document.
(e) No provision of this Agreement may be amended, modified or
waived, except in a writing signed by all of the parties hereto.
(f) This Agreement shall be construed in accordance with and
governed by the laws of the State of New York, without giving effect to conflict
of law principles. The parties hereby agree that any dispute which may arise
between them arising out of or in connection with this Agreement shall be
adjudicated before a court located in New York City, and they hereby submit to
the exclusive jurisdiction of the courts of the State of New York located in New
York, New York and of the federal courts in the Southern District of New York
with respect to any action or legal proceeding commenced by any party, and
irrevocably waive any objection they now or hereafter may have respecting the
venue of any such action or proceeding brought in such a court or respecting the
fact that such court is an inconvenient forum, relating to or arising out of
this Agreement, and consent to the service of process in any such action or
legal proceeding by means of registered or certified mail, return receipt
requested, in care of the address set forth in this Section 10.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
CONSULTANT:
________________________________________
COMPANY:
AMBIENT CORPORATION
By:_____________________________________
