GURU INTERNATIONAL, INC. CONSULTING AGREEMENT
Exhibit
10.2
GURU
INTERNATIONAL, INC.
This
Consulting Agreement (“Agreement”) is made and entered into as of the
27th
day of
April, 1999 by and between Guru International, Inc. and its subsidiaries (the
“Company”), and Rivington Investments N.V. (“Consultant”). The Company desires
to retain Consultant as an independent contractor to perform consulting services
for the Company and Consultant is willing to perform such services, on terms
set
forth more fully below. In consideration of the mutual promises contained
herein, the parties agree as follows:
1.
SERVICES
AND COMPENSATION
(a) Consultant
agrees to perform for the Company the services (“Services”) described in Exhibit
A, attached hereto.
(b) The
Company agrees to pay Consultant the compensation set forth in Exhibit A for
the
performance of the Services.
2.
CONFIDENTIALITY
(a) Definition.
“Confidential Information” means any Company proprietary information, technical
data, trade secrets or know-how, including, but not limited to, research,
product plans, products, services, customers, customer lists, markets, software,
developments, inventions, processes, formulas, technology, designs, drawings,
engineering, hardware configuration information, marketing, finances or other
business information disclosed by the Company either directly or indirectly
in
writing, orally or by drawings or inspection of parts or equipment.
(b) Non-Use
and Non-Disclosure.
Consultant will not, during or subsequent to the term of this Agreement, use
the
Company’s Confidential Information for any purpose whatsoever other than the
performance of the Services on behalf of the Company or disclose the Company’s
Confidential Information to any third party. It is understood that said
Confidential Information shall remain the sole property of the Company.
Consultant further agrees to take all reasonable precautions to prevent any
unauthorized disclosure of such Confidential Information including, but not
limited to, having each employee of Consultant, if any, with access to any
Confidential Information, execute a nondisclosure agreement containing
provisions in the Company’s favor identical to Sections 2, 3 and 4 of this
Agreement. Confidential Information does not include information which (i)
is
known to Consultant at the time of disclosure to Consultant by the Company
as
evidenced by written records of Consultant, (ii) has become publicly known
and
made generally available through no wrongful act of Consultant, or (iii) has
been rightfully received by Consultant from a third party who is authorized
to
make such disclosure. Without the Company’s prior written approval, Consultant
will not directly or indirectly disclose to anyone the existence of this
Agreement or the fact that Consultant has this arrangement with the Company.
(c) Former
Employer’s Confidential Information.
Consultant agrees that Consultant will not, during the term of this Agreement,
improperly use or disclose any proprietary information or trade secrets of
any
former or current employer or other person or entity with which Consultant
has
an agreement or duty to keep in confidence information acquired by Consultant,
if any, and that Consultant will not bring onto the premises of the Company
any
unpublished document or proprietary information belonging to such employer,
person or entity unless consented to in writing by such employer, person or
entity. Consultant will indemnify the Company and hold it harmless from and
against all claims, liabilities, damages and expenses, including reasonable
attorneys fees and costs of suit, arising out of or in connection with any
violation or claimed violation of a third party’s rights resulting in whole or
in part from the Company’s use of the work product of Consultant under this
Agreement.
(d) Third
Party Confidential Information.
Consultant recognizes that the Company has received and in the future will
receive from third parties their confidential or proprietary information subject
to a duty on the Company’s part to maintain the confidentiality of such
information and to use it only for certain limited purposes. Consultant agrees
that Consultant owes the Company and such third parties, during the term of
this
Agreement and thereafter, a duty to hold all such confidential or proprietary
information in the strictest confidence and not to disclose it to any person,
firm or corporation or to use it except as necessary in carrying out the
Services for the Company consistent with the Company’s agreement with such third
party.
(e) Return
of Materials.
Upon
the termination of this Agreement, or upon Company’s earlier request, Consultant
will deliver to the Company all of the Company’s property or Confidential
Information that Consultant may have in Consultant’s possession or control.
3.
OWNERSHIP
(a) Assignment.
Consultant agrees that all copyrightable material, notes, records, drawings,
designs, inventions, improvements, developments, discoveries and trade secrets
(collectively, “Inventions”) conceived, made or discovered by Consultant, solely
or in collaboration with others, during the period of this Agreement which
relate in any manner to the business of the Company that Consultant may be
directed to undertake, investigate or experiment with, or which Consultant
may
become associated with in work, investigation or experimentation in the line
of
business of Company in performing the Services hereunder are the sole property
of the Company. Consultant further agrees to assign (or cause to be assigned)
and does hereby assign fully to the Company all Inventions and any copyrights,
patents, mask work rights or other intellectual property rights relating
thereto.
(b) Further
Assurances.
Consultant agrees to assist Company, or its designee, at the Company’s expense,
in every proper way to secure the Company’s rights in the Inventions and any
copyrights, patents, mask work rights or other intellectual property rights
relating thereto in any and all countries, including the disclosure to the
Company of all pertinent information and data with respect thereto, the
execution of all applications, specifications, oaths, assignments and all other
instruments which the Company shall deem necessary in order to apply for and
obtain such rights and in order to assign and convey to the Company, its
successors, assigns and nominees the sole and exclusive right, title and
interest in and to such Inventions, and any copyrights, patents, mask work
rights or other intellectual property rights relating thereto. Consultant
further agrees that Consultant’s obligation to execute or cause to be executed,
when it is in Consultant’s power to do so, any such instrument or papers shall
continue after the termination of this Agreement.
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(c) Pre-Existing
Materials.
Consultant agrees that if in the course of performing the Services, Consultant
incorporates into any Invention developed hereunder any invention, improvement,
development, concept, discovery or other proprietary information owned by
Consultant or in which Consultant has an interest, (i) Consultant shall inform
Company, in writing before incorporating such invention, improvement,
development, concept, discovery or other proprietary information into any
Invention; and (ii) the Company is hereby granted and shall have a nonexclusive,
royalty-free, perpetual, irrevocable, worldwide license to make, have made,
modify, use and sell such item as part of or in connection with such Invention.
Consultant shall not incorporate any invention, improvement, development,
concept, discovery or other proprietary information owned by any third party
into any Invention without Company’s prior written permission.
(d) Attorney
in Fact.
Consultant agrees that if the Company is unable because of Consultant’s
unavailability, dissolution, mental or physical incapacity, or for any other
reason, to secure Consultant’s signature to apply for or to pursue any
application for any United States or foreign patents or mask work or copyright
registrations covering the Inventions assigned to the Company above, then
Consultant hereby irrevocably designates and appoints the Company and its duly
authorized officers and agents as Consultant’s agent and attorney in fact, to
act for and in Consultant’s behalf and stead to execute and file any such
applications and to do all other lawfully permitted acts to further the
prosecution and issuance of patents, copyright and mask work registrations
thereon with the same legal force and effect as if executed by Consultant.
4.
CONFLICTING
OBLIGATIONS
Consultant
certifies that Consultant has no outstanding agreement or obligation that is
in
conflict with any of the provisions of this Agreement, or that would preclude
Consultant from complying with the provisions hereof, and further certifies
that
Consultant will not enter into any such conflicting agreement during the term
of
this Agreement.
5.
TERM
AND TERMINATION
(a) Term.
This
Agreement will commence on the date first written above and will continue until
the earlier of (i) final completion of the Services or (ii) termination as
provided below.
3
(b) Termination.
The
Company may terminate this Agreement upon giving two weeks prior written notice
thereof to Consultant. Any such notice shall be addressed to Consultant at
the
address shown below or such other address as either party may notify the other
of and shall be deemed given upon delivery if personally delivered, or
forty-eight (48) hours after deposited in the United States mail, postage
prepaid, registered or certified mail, return receipt requested. The Company
may
terminate this Agreement immediately and without prior notice if Consultant
refuses to or is unable to perform the Services or is in breach of any material
provision of this Agreement.
(c) Survival.
Upon
such termination all rights and duties of the parties toward each other shall
cease except:
(i) that
the
Company shall be obliged to pay, within thirty (30) days of the effective date
of termination, all amounts owing to Consultant for Services completed and
accepted by the Company prior to the termination date and related expenses,
if
any, in accordance with the provisions of Section 1 (Services and Compensation)
hereof and
(ii)
Sections 2 (Confidentiality), 3 (Ownership) and 7 (Independent Contractors)
shall survive termination of this Agreement.
6.
ASSIGNMENT
Neither
this Agreement nor any right hereunder or interest herein may be assigned or
transferred by Consultant without the express written consent of the
Company.
7.
INDEPENDENT
CONTRACTOR
It
is the
express intention of the parties that Consultant is an independent contractor.
Nothing in this Agreement shall in any way be construed to constitute Consultant
as an agent, employee or representative of the Company, but Consultant shall
perform the Services hereunder as an independent contractor. Consultant agrees
to furnish (or reimburse the Company for) all tools and materials necessary
to
accomplish this contract, and shall incur all expenses associated with
performance, except as expressly provided on Exhibit A of this Agreement.
Consultant acknowledges and agrees that Consultant is obligated to report as
income all compensation received by Consultant pursuant to this Agreement,
and
Consultant agrees to and acknowledges the obligation to pay all self-employment
and other taxes thereon. Consultant further agrees to indemnify and hold
harmless the Company and its directors, officers, and employees from and against
all taxes, losses, damages, liabilities, costs and expenses, including
attorney’s fees and other legal expenses, arising directly or indirectly from
(i) any negligent, reckless or intentionally wrongful act of Consultant or
Consultant’s assistants, employees or agents, (ii) a determination by a court or
agency that the Consultant is not an independent contractor, or (iii) any breach
by the Consultant or Consultant’s assistants, employees or agent sof any of the
covenants contained in this Agreement.
8.
BENEFITS
4
Consultant
acknowledges and agrees and it is the intent of the parties hereto that
Consultant receive no Company-sponsored benefits from the Company either as
a
Consultant or employee. Such benefits include, but are not limited to, paid
vacation, sick leave, medical insurance, and 401(k) participation. If Consultant
is reclassified by a state or federal agency or court as an employee, Consultant
will become a reclassified employee and will receive no benefits except those
mandated by state or federal law, even if by the terms of the Company’s benefit
plans in effect at the time of such reclassification Consultant would otherwise
be eligible for such benefits.
9.
ARBITRATION
AND EQUITABLE RELIEF
(a)
Disputes.
Except
as provided in Section 9(d) below, the Company and Consultant agree that any
dispute or controversy arising out of, relating to or in connection with the
interpretation, validity, construction, performance, breach or termination
of
this Agreement shall be settled by binding arbitration to be held in San
Francisco County, California, in accordance with the Commercial Arbitration
Rules, supplemented by the Supplemental Procedures for Large Complex Disputes,
of the American Arbitration Association as then in effect (the “Rules”). The
arbitrator may grant injunctions or other relief in such dispute or controversy.
The decision of the arbitrator shall be final, conclusive and binding on the
parties to the arbitration. Judgment may be entered on the arbitrator’s decision
in any court of competent jurisdiction.
(b)
Consent
to Personal Jurisdiction.
The
arbitrator(s) shall apply California law to the merits of any dispute or claim,
without reference to conflicts of law rules. Consultant hereby consents to
the
personal jurisdiction of the state and federal courts located in California
for
any action or proceeding arising from or relating to this Agreement or relating
to any arbitration in which the parties are participants.
(c)
Costs.
The
Company and Consultant shall each pay one-half of the costs and expenses of
such
arbitration, and each shall separately pay its counsel fees and expenses unless
otherwise required by law.
(d)
Equitable
Relief.
The
parties may apply to any court of competent jurisdiction for a temporary
restraining order, preliminary injunction, or other interim or conservatory
relief, as necessary, without breach of this arbitration agreement and without
abridgment of the powers of the arbitrator.
(e)
Acknowledgment.
CONSULTANT HAS READ AND UNDERSTANDS SECTION 9, WHICH DISCUSSES ARBITRATION.
CONSULTANT UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, CONSULTANT AGREES TO
SUBMIT ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH THIS
AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH
OR
TERMINATION THEREOF, TO BINDING ARBITRATION, EXCEPT AS PROVIDED IN SECTION
9
(d), AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF CONSULTANT'S
RIGHT
TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL
ASPECTS OF THE RELATIONSHIP BETWEEN THE PARTIES.
5
10.
GOVERNING
LAW
This
Agreement shall be governed by the internal substantive laws, but not the choice
of law rules, of the State of California.
11.
ENTIRE
AGREEMENT
This
Agreement is the entire agreement of the parties and supersedes any prior
agreements between them, whether written or oral, with respect to the subject
matter hereof. No waiver, alteration, or modification of any of the provisions
of this Agreement shall be binding unless in writing and signed by duly
authorized representatives of the parties hereto.
12.
ATTORNEY’S
FEES
In
any
court action at law or equity which is brought by one of the parties to enforce
or interpret the provisions of this Agreement, the prevailing party will be
entitled to reasonable attorney’s fees, in addition to any other relief to which
that party may be entitled.
13.
SEVERABILITY
The
invalidity or unenforceability of any provision of this Agreement, or any terms
thereof, shall not affect the validity of this Agreement as a whole, which
shall
at all times remain in full force and effect.
14.
COUNTERPARTS
This
agreement may be executed in counterparts, each of which shall be an original,
but all of which together shall constitute one instrument.
6
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day
and year first above written.
RIVINGTON
INVESTMENT
N.V.
By:
/s/
EQUITY TRUST (CURACAO) N.V.
Title:
Managing
Director
Address:
Xxxxxxxxxxx
Xx, XX Xxx 0
Xxxxxxx,
Xxxxxxxxxxx
Xxxxx
GURU
INTERNATIONAL,
INC.
By:_________________________
Title:________________________
Address:_____________________
7
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day
and year first above written.
RIVINGTON
INVESTMENTS
N.V.
By:
_________________________
Title:
________________________
Address:
_____________________
GURU
INTERNATIONAL,
INC.
By:
Xxxxxx
X.
Title:
Chairman
Address:
Jerusalem
Tech. Park, Israel
8
EXHIBIT
A
SERVICES
AND COMPENSATION
1.
Contact.
Consultant’s principal Company contact:
Name:
EQUITY
TRUST (CURACAO) N.V.
Title:
MANAGING
DIRECTOR
2.
|
Services.
Consultant will render to the Company the following
Services;
|
Consultant
will be available for at least 4 hours per month for the purpose of providing
strategic business planning and product critique.
______________________________________________________________________________________________________________________________
3.
|
Compensation.
|
(a) The
unvested portion of all stock options held by Consultant under the Stock Option
Agreement between the Company and Consultant, dated ___, 1999 (the “Option
Agreement”), shall vest during the term of this Agreement according to the
vesting schedule set forth in the Option Agreement. Any vested stock options
held by Consultant shall remain exercisable until 90 days after the termination
of this Agreement.
(c) The
Company shall reimburse Consultant for all reasonable travel and living expenses
incurred by Consultant in performing Services pursuant to this Agreement,
provided Consultant receives written consent from an authorized agent of the
Company prior to incurring such expenses.
(d) Consultant
shall submit all statements for services and expenses in a form prescribed
by
the Company every two weeks and such statement shall be approved by the contact
person listed above or other designated agent of the Company.
GURU
INTERNATIONAL, INC.
STOCK
OPTION AGREEMENT
THIS
STOCK OPTION AGREEMENT (the “Agreement”) is made as of April 27, 1999 between
Guru International, Inc., a Delaware corporation (the “Company”), and Rivington
Investment, N.V. (the “Optionee”).
1.
Grant
of Option.
The
Company hereby grants to the Optionee an option (the “Option”) to purchase
50,000 shares (“Shares”) of the Company’s common stock (“Common Stock”) at an
exercise price of $0.05 per Share (the “Exercise Price”). This Option is no
intended to be an incentive stock option within the meaning of Section 4.2
of
the Internal Revenue Code of 1986, as amended (the “Code”).
2.
Vesting
Schedule.
This
Option may be exercised, in whole or in part, in accordance within the following
schedule:
1/24th
of the
Shares subject to the Option shall vest each month after the date of grant,
subject to Optionee’s continued consultancy with the Company.
3. Method
of Exercise.
This
Option is exercisable by delivery of an exercise notice, in the form attached
as
Exhibit A (the “Exercise Notice”), which shall state the election to exercise
the Option, the number of Shares in respect of which the Option is being
exercised (the “Exercised Shares”), and such other representations and
agreements as may be required by the Company. The Exercise Notice shall be
completed by the Optionee and shall be delivered to Secretary of the Company.
The Exercise Notice shall be accompanied by payment of the aggregate Exercise
Price as to all Exercised Shares. This Option shall be deemed to be exercised
upon receipt by the Company of such fully executed Exercise Notice accompanied
by such aggregate Exercise Price.
No
Shares
shall be issued pursuant to the exercise of this Option unless such issuance
and
exercise complies with applicable law. Assuming such compliance, for income
tax
purposes the Exercised Shares shall be considered transferred to the Optionee
on
the date the Option is exercised with respect to such Exercised
Shares.
4. Term
of Option.
Subject
to earlier termination as specified herein, this Option may be exercised until
April 27, 2009, after which this Option shall terminate.
5.
Termination
of Relationship.
(a) In
the
event of termination of Optionee’s status as a consultant of the Company for
Cause (as defined below), this Option may be exercised for a period of ninety
(90) days after the date of such termination (but in no event later than the
expiration date of this Option as set forth in Section 4 above) to the extent
that the Option is vested on the date of such termination. To the extent that
Optionee does not exercise this Option within the time specified herein, the
Option shall terminate.
Board
and
give the Optionee the right to exercise his or her Option as to any unexercised,
vested part of the Optioned Stock.
(b)
In
the event of termination of Optionee's status as a consultant of the Company
for
any reason other than for Cause, the Optionee shall fully vest in and have
the
right to exercise the Option as to all of the Shares, including Shares as
to
which it would not otherwise be vested or exercisable for a period of ninety
(90) days after the date of such termination (but in no event later than
the
expiration date of this Option as set forth in Section 4 above). To the extent
that Optionee does not exercise this Option within the time specified herein,
the Option shall terminate.
(c)
For the purposes of this Section 3, "Cause" shall mean any of the
following:
(i)
any material breach of the Consulting Agreement dated the date hereof
between the Company and Optionee (the "Consulting Agreement") by Optionee
or
Optionee's representatives performing on behalf of Optionee as consultant
to the
Company (Optionee or such representatives, the "Consultant");
(ii)
inability of Consultant to perform under the Consulting
Agreement;
(iii)
a willful act by Consultant which constitutes gross misconduct and
which is injurious to the Company;
(iv)
continued violations by the Consultant of Consultant's obligations
under the Consulting Agreement after there has been delivered to the Consultant
a written demand for performance from the Company which describes the basis
for
the Company's belief that the Consultant has not substantially performed
its
duties as the Company's consultant;
(v)
any material act of personal dishonesty involving the in connection
with its responsibilities as a Consultant to the Company; or
(vi)
the conviction or plea of guilty or nolo contendere to a
felony of Consultant which the Company's Board of Directors reasonably believes
had or will have a material detrimental effect on the Company's reputation
or
business.
6.
Optionee's
Representations. In the event the Shares have not
been registered under the Securities Act of 1933, as amended (the "Securities
Act"), at the time this Option is exercised, the Optionee shall, if required
by
the Company, concurrently with the exercise of all or any portion of this
Option, deliver to the Company his Investment Representation Statement in
the
form attached hereto as Exhibit B.
7.
Lock-Up
Period. Optionee hereby agrees that, if so requested by
the Company or any representative of the underwriters (the "Managing
Underwriter") in connection with any registration of the offering of any
securities of the Company under the Securities Act, Optionee shall not sell
or
otherwise transfer any Shares or other securities of the Company during the
180-day period (or such other period as may be requested in writing by the
Managing Underwriter and agreed to in writing by the Company) (the "Market
Standoff Period") following the effective date of a registration statement
of
the Company filed under the Securities Act. Such restriction shall apply
only to
the first registration statement of the Company to become effective under
the
Securities Act that includes securities to be sold on behalf of the Company
to
the public in an underwritten public offering of the Securities Act. The
Company
may impose stop-transfer instructions with respect to securities subject
to the
foregoing restrictions until the end of such Market Standoff
Period.
8.
Method
of Payment. Payment of the aggregate Exercise Price
shall be by any of the following, or a combination thereof, at the election
of
the Optionee:
(a)
cash; or
(b)
check; or
(c)
surrender of other shares of Common Stock of the Company which (i) in
the case of Shares acquired pursuant to the exercise of a Company option,
have
been owned by the Optionee for more than six (6) months on the date of
surrender, and (ii) have a fair market value (as determined by the Board
of
Directors of the Company (the "Board") in good faith) ("Fair Market Value")
on
the date of surrender equal to the Exercise Price of the Shares as to which
the
Option is being exercised;, or
(d)
to the extent permitted by the Board, delivery of a properly executed
exercise notice together with such other documentation as the Board and the
broker, if applicable, shall require to effect an exercise of the Option
and
delivery to the Company of the sale or loan proceeds required to pay the
Exercise Price.
9.
Non-Transferability
of Option. This Option may not be
transferred in any manner and may be exercised during the lifetime of Optionee
only by the Optionee. The terms of this Agreement shall be binding upon the
executors, administrators, heirs, successors and assigns of the
Optionee.
10.
Adjustments
Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.
(a)
Changes
in Capitalization. Subject to any required action by
the stockholders of the Company, the number of shares of Common Stock covered
by
this Option, as well as the price per share of Common Stock covered by this
Option, shall be proportionately adjusted for any increase or decrease in
the
number of issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common
Stock, or any other increase or decrease in the number of issued shares of
Common Stock effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall
not
be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination in that respect
shall
be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of shares
of Common Stock subject to this Option.
(b)
Dissolution
or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, to the extent that this Option
has
not been previously exercised, it will terminate immediately prior to the
consummation of such proposed action. The Board may, in the exercise of its
sole
discretion in such instances, declare that this Option shall terminate as
of a
date fixed by the Board and give the Optionee the right to exercise his or
her
Option as to any unexercised, vested part of the Optioned Stock.
(c) Merger,
Acquisition, or Asset Sale.
(i) In
the event of a merger of the Company with or into another corporation, an
acquisition of all or substantially all of the shares of the Company, or the
sale of substantially all of the assets of the Company (each such event,
a
“Transaction”), each outstanding Option shall be assumed on an equivalent
option or right substituted by the successor corporation or a parent or
subsidiary of the successor corporation. In the event that the successor
corporation refuses to assume or substitute for the Option, the Optionee
shall
fully vest in and have the right to exercise the Option as to all of the
Shares,
including Shares as to which it would not otherwise be vested or exercisable.
If
an Option or Stock Purchase Right becomes fully vested and exercisable in
lieu
of assumption or substitution in the event of a Transaction, the Administrator
shall notify the Optionee in writing or electronically that the Option shall
be
fully exercisable for a period of fifteen (15) days from the date of such
notice, and the Option or Stock Purchase Right shall terminate upon the
expiration of such period. For the purposes of this paragraph, the Option
shall
be considered assumed if, following a Transaction, the option or right confers
the right to purchase or receive, for each Share of Optioned Stock subject
to
the Option or Stock Purchase Right immediately prior to the Transaction,
the
consideration (whether stock cash, or other securities or property) received
in
the merger or sale of assets by holders of Common Stock for each Share held
on
the effective date of the Transaction (and if the holders were offered a
choice
of consideration, the type of consideration chosen by the holders of a majority
of the outstanding Shares); provided, however, that if such consideration
received in the Transaction is not solely common stock of the successor
corporation or its parent, the Administrator may, with the consent of the
successor corporation, provide for the consideration to be received upon
the
exercise of the Option, for each Share subject to the Option, to be solely
common stock of the successor corporation or its parent equal in fair market
value to the per share consideration by holders of Common Stock in the merger
or
sale of assets.
11. Tax
Consequences.
Some of
the federal tax consequences relating to the exercise and disposition of this
Option, as of the date of this Option are set forth below. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
THE OPTIONEE SHOULD CONSULT A TAX ADVISOR BEFORE EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES.
(a) Exercising
the Option.
The
Optionee may incur regular federal income tax liability upon exercise of the
Option. The Optionee will be treated as having received compensation income
(taxable at ordinary income tax rates) equal to the excess, if any, of the
Fair
Market Value of the Exercised Shares on the date of exercise over their
aggregate Exercise Price. If the Optionee is an employee or a former employee,
the Company will be required to withhold from his compensation or collect from
Optionee and pay to the applicable taxing authorities an amount in cash equal
to
a percentage of this compensation income at the time of exercise, any may refuse
to honor the exercise and refuse to deliver Shares if such withholding amounts
are not delivered at the time of exercise.
(b)
Disposition of Shares. If the Optionee holds Shares acquired upon
exercise of the Option for at least one year, any gain realized on disposition
of the Shares will be treated as long-term capital gain for federal income
tax
purposes.
12.
Entire
Agreement Governing Law. This
Agreement constitutes the entire agreement of the parties with respect to the
subject matter hereof and supersedes in its entirety all prior undertakings
and
agreements of the Company and Options with respect to the subject matter hereof,
and may not be modified except by means of a writing signed by the Company
and
Optionee. This Agreement is governed by the internal substantive laws, but
not
the choice of law rules, of California.
13.
NO
GUARANTEE OF CONTINUED SERVICE. OPTIONEE
ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING
SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING TO PROVIDE SERVICES AS A CONSULTANT
OF THE COMPANY AS PROVIDED HEREUNDER. OPTIONEE FURTHER ACKNOWLEDGES AND AGREES
THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING
SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF
CONTINUED ENGAGEMENT AS AN EMPLOYEE OR CONSULTANT FOR THE VESTING PERIOD, FOR
ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE
COMPANY'S RIGHT TO TERMINATE OPTIONEE'S RELATIONSHIPS AS AN EMPLOYEE OR
CONSULTANT AT ANY TIME, WITH OR WITHOUT CAUSE.
By
your signature and the signature of the Company's
representative below, you and the Company agree that this Option is granted
under and governed by the terms and conditions of this Agreement. Optionee
has
reviewed this Agreement in its entirety, has had an opportunity to obtain the
advice of counsel prior to executing this Agreement and fully understands all
provisions of this Agreement. Optionee further agrees to notify the Company
upon
any change in the residence address indicated below.
OPTIONEE/
RIVINGTON
INVESTMENTS N.V.
|
GURU INTERNATIONAL, INC. | ||
/s/ | /s/ Xxxxxx X. Xxxxxxxxxxx | ||
Signature |
By |
||
EQUITY
TRUST (CURACAO) N.V.
Managing
Director
|
|||
Chairman | |||
Print
Name
Xxxxxxxxxxx X0, X.X. Xxx 000 Xxxxxxx, Xxxxxxxxxxx Antilles
Residence Address
|
Title: |