ADVISORY AGREEMENT
Exhibit
10.2
This
Advisory Agreement (the “Agreement”) is made
and entered into as of the effective date June 20, 2008 (the “Effective Date”),
between Kronos Advanced Technologies, Inc. (“Kronos”), a Nevada
corporation and Xxxxxx X. Xxxxxx, an individual, hereinafter collectively
referred to as “Advisor”.
Recitals
WHEREAS,
Kronos is interested in Advisor providing Specialized Consulting Services as
detailed in Attachment A. For such service, Kronos is willing to
compensate Advisor, subject to the covenants, conditions and limitations set
forth in this Agreement.
WHEREAS,
Advisor has special knowledge and other background experience relevant to the
field and is willing to provide the services contemplated by and in accordance
with the covenants, conditions and limitations of this Agreement.
Agreement
In
consideration of the foregoing recitals, the mutual covenants hereinafter
provided, and for other good and valuable considerations, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound and equitably bound, hereby agree as follows:
I. Scope and Limitations of
Engagement.
1. Kronos appoints
Advisor. Kronos hereby appoints Advisor and Advisor hereby
accepts such appointment, on a non-exclusive basis, to provide the Services as
described in Attachment A
Statement of Work. The Statement of Work may be modified or amended
by mutual written consent of Kronos and Advisor.
2. Independent Status of
Advisor. Advisor shall, at all times, be an independent
contractor hereunder, rather than a co-venturer, agent, employee, or
representative of Kronos. Advisor shall be responsible for Advisor’s
taxes, shall not be required to work on a continuing daily basis or
any specific work schedule, and shall not be provided with office space or
administrative support by Kronos. Advisor is permitted to engage in other
businesses and ventures. Advisor shall be solely responsible for
complying with all laws, rules, and regulations applicable to its services
hereunder. Kronos shall not be liable for any injury (including
death) to Advisor or others, workmen’s compensation, employer’s liability,
social security, withholding tax, or other taxes of similar nature for or on
behalf of Advisor or any other person, persons, firms or corporations consulted
by Advisor in carrying out this Agreement. It is understood, however,
that should Kronos be held liable for any social security, withholding or other
taxes of a similar nature on behalf of Advisor, then Kronos shall have the right
to recover an equivalent
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amount
from Advisor or deduct such amount from any compensation due to Advisor pursuant
to this Agreement.
3. Confidentiality. The
Advisor acknowledges that during the Term of this Agreement, the Advisor may be
given access to or may become acquainted with Confidential Information (as
hereinafter defined) and/or trade secrets of Kronos. Subject to the
exceptions set forth below and permitted uses of Confidential Information in
connection with the provision of services pursuant to this Agreement, the
Advisor acknowledges that the Confidential Information and/or trade secrets of
Kronos as such may exist from time to time, are valuable, confidential, special
and unique assets of Kronos, expensive to produce and maintain and essential for
the operation of its business. The Advisor hereby agrees that he shall not,
during the Term of this Agreement and for a period of five (5) years thereafter,
directly or indirectly, communicate, disclose or divulge to any Person, as
defined below, or use for its benefit or the benefit of any Person, in any
manner any Confidential Information or trade secrets of Kronos acquired before
or during the Term of this Agreement, or any other Confidential Information
concerning the conduct and details of the businesses of Kronos, except as may be
required for the Advisor to perform the services hereunder and otherwise to
comply with the terms and conditions and intent of this Agreement and by law, or
to enforce the Advisor’s rights hereunder. As used in this Section,
"Confidential
Information” of Kronos means any and all information (verbal and written)
relating to Kronos or any of its subsidiaries or any of its affiliates, or any
of their respective activities, including, but not limited to, information
relating to trade secrets, personnel lists, financial information, research
projects, services used, pricing, software, software code, technical memoranda,
designs and specifications, new products and services, comparative analyses of
competitive products, technology, know-how, customers, customer lists and
prospects, product sourcing, marketing and selling and
servicing. Confidential Information shall not include information
that, at the time of disclosure, (a) is known or available to the general public
by publication (including, without limitation, the public disclosure of
information pursuant to Kronos’ reporting obligations under applicable federal
and state securities laws) or otherwise through no act or failure to act on the
part of the Advisor in violation of this Section I(3), (b) became known or
was derived by the Advisor by some demonstrable means other than as a result of
the Advisor’s access thereto, (c) was rightfully received from a third party
without similar restrictions and without breach of this Agreement or any other
agreement, or (d) was independently developed by the Advisor without any
utilization of the Confidential Information. The Advisor shall not be
liable for any disclosure of Confidential Information made pursuant to a valid
and enforceable judicial or governmental order (a “Mandated Disclosure”)
not sought by the Advisor for the purpose of circumventing his obligations
hereunder; provided, however, that the Advisor’s obligations under this Section
I (3) shall be deemed satisfied if, promptly upon the Advisor’s receipt of
a subpoena or other written notice seeking disclosure of Confidential
Information, the Advisor shall provide written notice to Kronos of any attempt
to obtain the Mandated Disclosure and in any event prior to any disclosure of
Confidential Information pursuant thereto, and reasonably cooperates with Kronos
in the event that Kronos elects to legally contest and avoid the Mandated
Disclosure.
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II. Intellectual
Property.
1. Advisor
covenants and agrees that any works of authorship, work product, materials,
copyrights, discoveries, improvements, inventions and/or patent rights and
anything else that Advisor may make or acquire, either solely or jointly with
others, which result from Advisor’s contact with Kronos personnel and operation
or from Advisor’s work for Kronos, during the Term of this Agreement or while
engaged upon the advisory work under this Agreement, and for six (6) months
thereafter, shall be the exclusive property of Kronos and agrees to assign, and
by these presents does hereby assign and transfer all his entire right, title
and interest in and to such inventions, improvements and patent rights to
Kronos, its successors and assigns, and Advisor agrees upon the request of
Kronos to execute and deliver all documents and perform such acts necessary or
advisable to secure to Kronos, its successors and assigns or its nominee without
payment of additional consideration therefore other than the payment for said
advisory services as herein provided, the entire right, title and interest in
and to said discoveries, improvements and inventions, including applications for
and/or letters patent of the United States and countries foreign thereto
provided the cost of preparing such papers, assignments and applications for
letters patent and the prosecution and maintenance of said applications for
and/or letters patent and all proceedings and litigation is borne by Kronos or
its nominee. Both parties agree that any obligation Advisor may now
have to assign inventions to Kronos is not waived or changed by terms of this
Agreement.
2. Advisor
agrees that any and all information including know-how and trade secrets that
may be imparted to him by Kronos as well as Advisor’s advice, recommendations
and opinions resulting from such advisory service shall be maintained
confidential and secret and Advisor shall not use or disclose said information
to others except officials and duly authorized employees and representatives of
Kronos, without prior written consent and approval of Kronos.
3. Advisor
shall at all times during and after the Term of this Agreement, upon the request
and the expense of Kronos, execute and deliver any and all papers, and do any
and all lawful acts that may be necessary or desirable in the opinion of Kronos
including but not limited to:
a. To
obtain letters patent, both domestic and foreign on said
inventions;
b. To
secure, establish and maintain title in Kronos, its successors and assigns, to
said inventions, applications and letters patent, including making such title of
lawful and public record;
c. To
cooperate fully with Kronos, both during and after the Term of this Agreement,
with respect to the procurement, perfection of title, maintenance and
enforcement of copyrights, patents and other intellectual property rights (both
in the United States and foreign countries) relating to developments or
inventions; to sign all papers, including, without limitation, copyright
applications, patent applications, declarations, oaths, formal assignments,
assignments of priority rights, and powers of attorney, which Kronos may
deem
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necessary
or desirable in order to protect its rights and interests in any development or
invention. If Kronos is unable, after reasonable effort, to secure
Advisor’s signature on any such papers, any executive officer of Kronos shall be
entitled to execute any such papers as his agent and attorney-in-fact, and
Advisor hereby irrevocably designates and appoints each executive officer of
Kronos as his agent and attorney-in-fact to execute any such papers on Advisor’s
behalf, and to take any and all actions as Kronos may deem necessary or
desirable in order to protect its rights and interests in any development or
invention, under the conditions described in this sentence.
d. To
defend, establish or otherwise preserve the validity of said letter patent
against any and all infringers.
4. Advisor
shall promptly disclose to Kronos or its designees, in writing, all inventions
(regardless of whether such inventions are related to the business, products or
services of Kronos or any of its affiliated companies) made or conceived, either
solely or jointly with others, during the term of this Agreement and for six (6)
months thereafter.
5. Advisor
shall within two (2) days after written request by Kronos turn over to Kronos
all plans, notes, blueprints, designs, models, laboratory notebooks, etc.,
relating to inventions conveyed or covered by this Agreement, and Advisor hereby
assigns, sells, transfers and sets over unto Kronos all right, title and
interest in and to said plans, notes, blueprints, designs, models, laboratory
notebooks, etc.
III. Compensation;
Indemnification.
1. Advisor’s
Fee. Kronos shall pay to Advisor and Advisor shall receive
from Kronos the Advisor’s Fee as described in Attachment A Statement of
Work. Any compensation payable to any person other than the Advisor
in connection with the provision of the Advisor’s services hereunder shall be
paid out of the compensation described in this Section III. The
compensation to be paid in accordance with Attachment A is the sole compensation
to be paid by Kronos in connection therewith.
2. Expense
Reimbursement. Kronos shall reimburse pre-approved travel or
other pre-approved expenses incurred by Advisor in connection with services to
be rendered by Advisor pursuant to this Agreement, as expressly agreed in
advance and writing by Kronos. Pre-approved travel and pre-approved
other expenses will be reimbursed within thirty (30) business days from receipt
of expense documentation.
3. Indemnification. The
Company agrees that (a) if Advisor is made a party, or is threatened to be made
a party, to any “Proceeding” (defined
as any threatened or actual action, suit or proceeding whether civil, criminal,
administrative, investigative, appellate or other) by reason of the fact that he
is or was a contractor, agent or consultant of the Company, or (b) if any “Claim” (defined as
any claim, demand, request, investigation, dispute, controversy, threat,
discovery request or request for testimony or information) is made, or
threatened to be made, that arises out of or relates to the Advisor’s service in
any of the foregoing capacity or to the Company, then Advisor shall promptly be
indemnified and held harmless by the Company
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against
any and all costs, expenses, liabilities and losses (including, without
limitation, attorney’s fees, judgments, damages, interest, expenses of
investigation, penalties, fines, taxes or penalties and amounts paid or to be
paid in settlement) incurred or suffered by Advisor in connection therewith;
provided that such Claims are not based upon or arise out of (i) any negligent
act or omission of Advisor, (ii) any act or omission of Advisor in breach of
this Agreement, subject to the notice and cure period set forth herein, or (iii)
criminal and/or fraudulent acts or omissions of Advisor. Such
indemnification shall continue as to Advisor even if he has ceased to be a
contractor, agent or consultant of the Company and shall inure to the benefit of
Advisor’s successors, assigns, heirs, executors and
administrators. The Company shall reimburse Advisor reasonable and
necessary costs and expenses incurred by him in connection with any such Proceeding or
Claim within thirty (30) days of written submission of a request for
reimbursement and provision of all documentation or information to support the
request.
IV. Advisors Warranties,
Representations and Additional Covenants.
1. Full
Authority. Advisor warrants and represents to Kronos
that: (i) Advisor has the full unrestricted right to enter into this
Agreement; (ii) by entering into this Agreement, Advisor is not violating or
otherwise contravening any agreement to which Advisor is bound or any applicable
law; and (iii) no person must consent to the execution and performance of this
Agreement by Advisor.
2. Fraud and Bad
Acts. Advisor represents and warrants to Kronos that Advisor
is not now, and covenants that Advisor shall not in the future be, a person (i)
subject to an order of any regulator under applicable law, or (ii) convicted
within the previous ten (10) years of a felony.
3. Compliance with all
laws. Advisor covenants with Kronos that Advisor shall comply
with all applicable laws in connection with the execution and performance of
this Agreement.
4. Full Disclosure to
Kronos. Without limiting any other provision of this
Agreement, Advisor agrees to fully disclose all activities in which Advisor is
engaged other than pursuant to this Agreement.
V. Term and
Termination.
1. The
term of this Agreement is six (6) months from the Effective Date (the “Term”).
2. This
Agreement may be terminated immediately by either party, without notice, in the
event that either party commits a material breach of this Agreement, which
breach remains uncured for 10 business days after written notice
thereof.
3. In
the absence of a material breach by Advisor, Kronos may terminate this Agreement
upon ten (10) days prior written notice to Advisor. In the event of
termination
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pursuant
to this section V(3), Advisor shall be entitled to all compensation which has
been earned pursuant to this Agreement prior to and including such date of
termination.
VI. Miscellaneous.
1. Binding Effect and Survival
of Rights. This Agreement will benefit and bind the parties
and their respective personal representatives, executors, administrators, heirs,
legatees, devisees, successors and assigns.
2. Notices. All
notices, demands, requests and other communications required or permitted to be
given by any provision of this Agreement will be in writing addressed as
follows:
|
If to
Kronos:
|
Kronos
Advanced Technologies, Inc.
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
XX 00000
|
|
|
Telephone:
Attention: |
000-000-0000 Xxxxxxx X. Xxxxxx Chief
Operating Officer
|
|
|
If to
Advisor:
|
Xxxxxx
X. Xxxxxx
|
|
Any such notice, demand, request or
communication will be deemed to have been given and received for all purposes
under this Agreement: (a) on the date of delivery when delivered in person; (b)
on the date of transmission when delivered by facsimile transmission (provided
such transmission is confirmed by transmission receipt and such notice is
promptly confirmed by some other means described herein); and/or (c) on the next
business day after the same is deposited with a nationally recognized overnight
delivery service that guarantees overnight delivery; provided, however, if the
day such notice, demand, request or communication will be deemed to have been
given and received as aforesaid is not a business day, such notice, demand,
request or communication will be deemed to have been given and received on the
next business day.
Any party to this Agreement may change
such parties address for the purpose of notice, demands, requests and
communications required or permitted under this Agreement by providing written
notice of such change of address to all of the parties by written notice as
provided herein.
3. Interpretation. The
parties acknowledge to each other that each party has reviewed and participated
in the negotiation of this Agreement. Accordingly, the normal rule
of
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construction
to the effect that any ambiguities are resolved against the drafting party will
not be employed in the interpretation of this Agreement.
4. Incorporation. The
Recitals, all exhibits and schedules attached hereto, or to be attached hereto,
and all other agreements and instruments referred to herein are hereby
incorporated by reference into this Agreement as fully as if copied herein
verbatim.
5. Further
Assurances. The parties further agree that, upon request, they
will do such further acts and deeds and will execute, acknowledge, deliver and
record such other documents and instruments as may be reasonably necessary from
time to time to evidence, confirm or carry out the intent and purpose of this
Agreement.
6. Lawful
Authority. Each party executing this Agreement hereby
represents and warrants to all other parties that they have been fully
authorized to execute and deliver this Agreement.
7. Attorneys
Fees. If any legal action or other proceeding (including
arbitration pursuant to this Agreement) is brought for the enforcement of this
Agreement, or because of any alleged dispute, breach, default or
misrepresentation in connection with any provisions of this Agreement, the
prevailing party will be entitled to recover reasonable attorneys fees, court
costs and all reasonable expenses, even if not taxable or assessable as court
costs (including, without limitation, all such fees, costs and expenses incident
to appeal) incurred in that action or proceeding in addition to any other relief
to which such party may be entitled.
8. Waivers and
Consents.
(i) Each
and every waiver of any provision of this Agreement must be in writing and
signed by each party whose interests are adversely affected by such
waiver.
(ii) Unless
otherwise expressly provided in a waiver, no such waiver granted in any one
instance will be construed as a continuing waiver applicable in any other
instance.
(iii) No
waiver by any party to this Agreement to or of any breach or default by any
other party to this Agreement in the performance by such other party of its
obligations hereunder will be deemed or construed to be a waiver of any breach
or default of any other party of the same or any subsequent obligations
hereunder.
(iv) Subject
to applicable statutes of limitation, the failure on the part of any party to
this Agreement to complain of any act or failure to act of any other party to
this Agreement or to declare such other party in default, irrespective of how
long such failure continues, shall not constitute a waiver by the non-defaulting
party of its rights hereunder.
(v) Each
and every consent by any party to this Agreement must be in writing signed by
the party to be bound thereby. No consent will be deemed or construed
to be a consent to any action except as described in such writing.
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9.
Section
Headings. The Section headings contained in this Agreement are
for reference purposes only and will not affect the interpretation of this
Agreement.
10. Governing
Law. This Agreement will be governed in all respects,
including validity, interpretation and effect by, and will be enforceable in
accordance with, the internal laws of the State of Massachusetts without regard
to conflicts of laws principles.
11. Severability. If
any provision of this Agreement is held to be unlawful, invalid or unenforceable
under present or future laws effective during the term hereof, such provision
will be fully severable, and this Agreement will be construed and enforced
without giving effect to such unlawful, invalid or unenforceable
provision. Furthermore, if any provision of this Agreement is capable
of two (2) constructions, one of which would render the provision void, and the
other which would render the provision valid, then the provision will have the
meaning which renders it valid.
12. Counterpart
Execution. This Agreement may be executed in multiple
counterparts, each one of which will be deemed an original, but all of which
will be considered together as one and the same instrument. Further,
in making proof of this Agreement, it will not be necessary to produce or
account for more than one (1) such counterpart. Provided all parties
have signed at least one counterpart, the execution by a party of a signature
page hereto will constitute due execution and will create a valid, binding
obligation of the party so signing, and it will not be necessary or required
that the signatures of all parties appear on a single signature page
hereto.
13. Amendments. Each
and every modification and amendment of this Agreement must be in writing and
except as otherwise provided herein, signed by all the parties
hereto.
14. Entire
Agreement. This Agreement and that certain Severance Agreement
dated as of May 16, 2008 by and between the parties (the “Severance Agreement”)
(including all agreements referenced in the “Entire Agreement” section of the
Severance Agreement) contain the entire agreement between the parties regarding
the subject matter hereof. Any prior agreements, discussions or
representations not expressly contained in this Agreement will be deemed to be
replaced by the provisions hereof, and no party has relied on any such prior
agreements, discussions or representations as an inducement to the execution
hereof. To the extent there is any conflict between this Agreement
and the Severance Agreement regarding Advisor’s provision of consulting services
to the Company, this Agreement shall control.
15. Rules of
Construction. (a) All terms in this Agreement in the singular
and plural will have comparable meanings when used in the plural and vice-versa
unless otherwise specified; (b) the words hereof, herein, hereunder
and words of similar import when used in this Agreement, will refer to this
Agreement as a whole and not any particular provision of this Agreement and all
references to articles, sections and subdivisions thereof are to this Agreement
unless otherwise specified; (c) the words include, includes and
including will be deemed to be followed by the phrase without
limitation; (d) all pronouns and any variations thereof will
be
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deemed to
refer to masculine, feminine or neuter, singular or plural, as the identity of
the individual, individuals, entity or entities may require; (e) all
references to documents, contracts, agreements or instruments will include any
and all supplements and amendments thereto; and (f) all accounting
terms not specifically defined herein will be construed in accordance with
generally accepted accounting principles or generally accepted auditing
standards then applied in the United States.
16. Forum
Selection. ADVISOR AND KRONOS DO HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMIT TO THE SOLE AND EXCLUSIVE JURISDICTION OF THE COURTS OF
THE STATE OF MASSACHUSETTS AND DO FURTHER IRREVOCABLY AND UNCONDITIONALLY
STIPULATE AND AGREE THAT THE FEDERAL COURTS IN THE STATE OF MASSACHUSETTS OR THE
STATE COURTS OF MASSACHUSETTS WILL HAVE JURISDICTION TO HEAR AND FINALLY
DETERMINE ANY DISPUTE, CLAIM, CONTROVERSY OR ACTION ARISING OUT OF OR CONNECTED
(DIRECTLY OR INDIRECTLY) WITH THIS AGREEMENT THAT IS NOT SUBJECT TO ARBITRATION,
OR TO ENTER A JUDGMENT CONSISTENT WITH ANY ARBITRATION AWARD. ADVISOR AND KRONOS
FURTHER HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY AND ALL OBJECTIONS OR
DEFENSES TO SAID JURISDICTION. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT SERVICE UPON ANY PARTY HERETO SHALL
BE MADE BY DELIVERY VIA PRIORITY OVERNIGHT DELIVERY (E.G., FEDEX) AND BY
FACSIMILE OF A COPY OF SUCH PROCESS TO THE ADDRESS OF SUCH PARTY FOR NOTICES TO
SUCH PARTY AS SET FORTH IN THIS AGREEMENT LETTER (OR SUCH DIFFERENT ADDRESS AT
SUCH PARTY WILL HEREAFTER SPECIFY IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT). THE FOREGOING CONSENT, IN ADVANCE, TO THE JURISDICTION OF
THE AFOREMENTIONED COURTS AND THE AFOREMENTIONED METHOD OF SERVICE ARE MATERIAL
INDUCEMENTS FOR THE PARTIES HERETO TO ENTER INTO THIS AGREEMENT.
17. Personal Nature of
Undertaking. Advisor acknowledges that the engagement of
Advisor’s services hereunder by Kronos is personal to Advisor, and such services
shall not be delegated or assigned to any other Person or Advisor without
Kronos’ express prior written consent, which may be withheld in Kronos’ sole and
absolute discretion.
[signatures
appear on next page]
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IN WITNESS WHEREOF, the
parties have executed this Advisors Agreement effective as of the date signed by
the parties, as shown below.
| Kronos Advanced Technologies: | |||
|
By:
|
/s/ Xxxxxxx X Xxxxxx | ||
| Xxxxxxx X Xxxxxx | |||
| Title: Chief Operating Officer | |||
| Advisor: | |||
|
By:
|
/s/ Xxxxxx X. Xxxxxx | ||
| Xxxxxx X. Xxxxxx | |||
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ATTACHMENT
A
Statement of Work
#1
I.
Dwight to respond to verbal and written inquiries from X. Xxxxxx and X.
Xxxxxxx concerning Transition Services as defined in the Severance Agreement and
General Release.
II.
Xxxxxx to create Kronos work product or commentary to Kronos work product
or other consulting services as requested in writing by X. Xxxxxx and X.
Xxxxxxx.
Advisor’s
Fee shall be $300 per hour. Monthly invoice with hours per approved
Statement of Work # to be sent to X. Xxxxxx at the Kronos Corporate address and
copy via email.
